If enacted, HB 399 will amend Chapter 235 of the Hawaii Revised Statutes, introducing a new section that provides a nonrefundable income tax credit for a specified number of qualified interns. The tax credit can be deducted from the employer's net income tax liability and is set to begin for tax years after January 1, 2024, and before January 1, 2025. Employers can claim a credit equal to the value of fifty hours of wages paid to a qualified intern, subject to specific eligibility criteria. Notably, the maximum number of interns for whom a credit can be claimed is limited to 5,250 per calendar year.
House Bill 399 focuses on establishing a tax credit for employers who provide work-based learning programs for qualified interns in Hawaii. The intent of the bill is to enhance the employment opportunities for local students by incentivizing businesses, particularly small and medium-sized companies, to create and fund internship positions. The financial support offered through the tax credits is aimed at increasing the number of work-based learning experiences that students can access before graduating high school. This is seen as a critical step towards ensuring local students are better prepared for the workforce.
Key points of contention surrounding this bill may include concerns regarding the effectiveness of tax credits as a means to create substantial internship opportunities. Critics may argue that while the initiative aims to foster work experience for students, it might not directly address other underlying issues preventing employers from offering internships, such as the costs associated with managing interns. Additionally, there are eligibility requirements that could restrict participation, such as the criteria around prior employment of the intern, which could limit the program’s accessibility for some businesses. As with many tax credit proposals, there may be debates regarding fiscal impacts and the equitable distribution of benefits.