In 2014-2018, the Hawaii legislature considered legislation that would repeal the dividends paid deduction (DPD). In 2018, the Hawaii legislature again considered legislation to repeal the DPD as well as to require REITs to withhold Hawaii taxes when dividends are distributed to shareholders.
In 2019, the legislature once again considered similar legislation, and both the House and Senate passed SB 301. On June 24, 2019, Hawaii Governor David Ige announced his intention to veto SB 301. On July 9, 2019, Governor Ige vetoed SB 301.
In connection with the Hawaii legislature’s 2019 session, the following REIT-related bills were introduced:
- HB 475
- Nareit testimony to the House Committee on Economic Development & Business in opposition to HB 475 - 1/30/19
- Nareit testimony to the House Consumer Protection & Commerce Committee in opposition to HB 475 HD 1 - 2/12/19
- Nareit testimony to the House Finance Committee in opposition to HB 475 HD 1 - 2/20/19
- SB 301
- Nareit testimony to the Senate Ways & Means Committee in opposition to SB301 - 2/6/19
- Nareit testimony to the House Economic Development & Business Committee in opposition to SB 301 SD 1 - 3/13/19
- Nareit testimony to the House Consumer Protection & Commerce Committee in opposition to SB 301 SD 1 - 3/19/19
- SB 675
- HB 605
- SB 1510
- HB 740
- HB 1064
- HB 1290
These bills would eliminate the REIT DPD and/or impose a shareholder withholding tax and information reporting requirement with respect to dividends paid by REITs.