HOUSE OF REPRESENTATIVES	H.B. NO.	476
THIRTY-FIRST LEGISLATURE, 2021		H.D. 3
STATE OF HAWAII		S.D. 1

A BILL FOR AN ACT

 

 

RELATING TO TAXATION.

 

 

BE IT ENACTED BY THE LEGISLATURE OF THE STATE OF HAWAII:

 

     SECTION 1.  Chapter 245, Hawaii Revised Statutes, is amended by adding a new section to be appropriately designated and to read as follows:

     "§245-     Taxation of modified risk tobacco products.  Notwithstanding any law to the contrary, every wholesaler, in addition to any other taxes provided by law, shall pay for the privilege of conducting business and other activities in the State an excise tax equal to fifty per cent of the otherwise applicable tax under section 245-3 for each modified risk tobacco product sold, used, or possessed by a wholesaler, or if not sold then at the same rate upon the use by the wholesaler.

     As used in this section "modified risk tobacco product" means any product for which a modified risk tobacco product order has been issued by the Secretary of the United States Department of Health and Human Services pursuant to title 21 United States Code section 387k(g)."

     SECTION 2.  Section 245-1, Hawaii Revised Statutes, is amended as follows:

     1.  By adding two new definitions to be appropriately inserted and to read:

     ""E-liquid" means any liquid or like substance, which may or may not contain nicotine, that is designed or intended to be used in an electronic smoking device, whether or not packaged in a cartridge or other container.  "E-liquid" does not include prescription drugs; medical cannabis or manufactured cannabis products pursuant to chapter 329D; or medical devices used to aerosolize, inhale, or ingest prescription drugs, including manufactured cannabis products manufactured or distributed in accordance with section 329D—10(a).

     "Smoke" or "smoking" means inhaling, exhaling, burning, carrying, or possessing any lighted or heated tobacco product, or similar substance intended for human consumption, including the use of an electronic smoking device that creates an aerosol or vapor, in any manner or in any form."

     2.  By amending the definition of "tobacco products" to read:

     ""Tobacco products" means [tobacco]:

     (1)  Tobacco in any form, other than cigarettes or little cigars that [is prepared or intended for consumption or for personal use by humans, including large cigars and any substitutes thereof other than cigarettes that bear the semblance thereof, snuff, chewing or smokeless tobacco, and smoking or pipe tobacco.] is intended for human consumption, or is likely to be consumed whether smoked, heated, chewed, absorbed, dissolved, inhaled, or ingested by other means;

     (2)  E—liquid; or

     (3)  Electronic smoking device.

Tobacco products includes but is not limited to large cigars and any substitutes thereof other than cigarettes that bear the semblance thereof, pipe tobacco, chewing or smokeless tobacco, snuff, snus, e-liquid, electronic smoking device, any cartridge or other component part of the device or product, and related products."

     SECTION 3.  Section 245-31, Hawaii Revised Statutes, is repealed.

     ["§245-31  Monthly report on distributions of cigarettes and tobacco products, and purchases of stamps.  (a)  On or before the twentieth day of each month, every licensee shall file on forms prescribed by the department:

     (1)  A report of the licensee's distributions of cigarettes and purchases of stamps during the preceding month; and

     (2)  Any other information that the department may require to carry out this part.

     (b)  On or before the twentieth day of each month, every licensee shall file on forms prescribed by the department:

     (1)  A report of the licensee's distributions of tobacco products and the wholesale costs of tobacco products during the preceding month; and

     (2)  Any other information that the department may require to carry out this part."]

     SECTION 4.  This Act does not affect rights and duties that matured, penalties that were incurred, and proceedings that were begun before its effective date.

     SECTION 5.  Statutory material to be repealed is bracketed and stricken.  New statutory material is underscored.

     SECTION 6.  This Act shall take effect on July 1, 2060.

 

Report Title:

Electronic Smoking Devices; E-liquid; Taxation; Regulation; Modified Risk Tobacco Products

 

Description:

Imposes an excise tax of fifty percent of the otherwise applicable tax under section 245-3, HRS, on every wholesaler for each modified risk tobacco product sold, used, or possessed by a wholesaler.  Defines modified risk tobacco product.  Defines "e‑liquids" and "smoke" or "smoking".  Amends the definition of "tobacco products".  Effective 7/1/2060.  (SD1)

 

 

 

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