If enacted, the bill will bring significant changes to the current tax structure concerning pensions. By imposing a tax on out-of-state pensions, it is anticipated that the state will generate an additional revenue stream, which legislators believe can contribute to economic growth. The bill's proponents argue that it will level the playing field between retirees who have worked within the state and those who have worked elsewhere, creating a fairer taxation system. This shift may also make Hawaii a less attractive destination for individuals considering retirement, particularly those heavily reliant on out-of-state pensions.
Summary
House Bill 1572 relates to taxation, specifically targeting the treatment of pension income for individuals retiring in Hawaii. The bill aims to amend Section 235-7 of the Hawaii Revised Statutes by limiting the exclusion from gross income for pension income to only those pensions earned for services performed within the State of Hawaii. Currently, pensions from past services performed outside the state are exempt from state income tax, which has led to concerns about equity among Hawaii taxpayers. This bill is introduced to rectify what has been perceived as an imbalance in how different retirees are treated under the state's taxation system.
Contention
There are concerns surrounding this bill, primarily from those who fear that taxing out-of-state pensions may deter potential retirees from moving to Hawaii. Critics suggest that this could have adverse effects on the local economy, especially if an influx of retirees, who might contribute significantly to the state's economy, is dissuaded by the new tax policies. Additionally, there may be debates concerning the unintended consequences of such taxation on local businesses that cater to the retiree population and the overall community's demographic shifts.
A bill for an act relating to property taxation for commercial child care centers and facilities and including effective date, applicability, and retroactive applicability provisions.(Formerly HSB 224.)
A bill for an act relating to property taxation for commercial child care centers and facilities and including effective date, applicability, and retroactive applicability provisions.(See HF 668.)
A bill for an act placing assessment limitations for property tax purposes on commercial child care facilities, and including effective date, applicability, and retroactive applicability provisions.(Formerly HSB 726.)
A bill for an act placing assessment limitations for property tax purposes on commercial child care facilities, and including effective date, applicability, and retroactive applicability provisions.(See HF 2655.)