Hawaii House Bill HB1265

Hawaii 2025 Regular Session

• Introduced: 1/23/25
• Refer: 1/27/25

Caption

Relating To Tax Credits.

Impact

This tax credit would allow businesses to claim a deduction based on their use of recycled or waste inputs, with a proposed structure providing ten percent of the costs up to $500,000, or fifteen percent for businesses located in rural areas, capped at $750,000. This financial incentive may encourage more businesses to source materials from certified recycling or waste recovery facilities, thus supporting local economies and recycling industries. Moreover, the bill sets clear requirements that the recycled or waste inputs must meet, promoting accountability and compliance within the tax credit program.

Summary

House Bill 1265 aims to establish a tax credit for businesses incorporating recycled or waste inputs into their operations. The bill recognizes the importance of promoting sustainable practices and reducing the environmental impacts of waste. By incentivizing businesses to use recycled materials, the legislation seeks to encourage a shift towards a circular economy which not only conserves natural resources but also mitigates environmental challenges faced by the State of Hawaii.

Contention

Notably, the bill's stipulation that excess credits can be carried over into subsequent tax years illustrates an effort to enhance its usability for businesses with fluctuating revenue. However, as the bill approaches its effective date of December 31, 2025, discussions may arise regarding the adequacy of tax credits versus the potential administrative burden on businesses needing to document compliance. Stakeholders might also debate the overall effectiveness of these incentives in significantly reducing waste and sparking broader business transformation towards environmentally friendly practices.