- Associated Press - Tuesday, March 4, 2014

HONOLULU (AP) - Hawaii lawmakers are trying to level the playing field for retailers on the islands by mandating taxes on Internet sales transactions.

The state House of Representatives approved a bill Tuesday that would require online retailers to collect taxes and pay them to the state.

It also would make third-party referral websites like Amazon.com that connect customers with sellers to collect some taxes or face a penalty.

“It is our responsibility to adapt as times change, markets change, trends change,” said Rep. Kyle Yamashita, a Democrat who represents Makawao and Wailuku. “As we know, the Internet is becoming more and more popular. And we have to figure out, how do we maintain our revenues?”

Lawmakers said the extra money could help pay for services to those that are most vulnerable. The Chamber of Commerce of Hawaii supported the measure.

“We have an obligation to future generations,” said Rep. Rida Cabanilla, D-Ewa. “There is a huge debt in this state. We have unfunded mandates.”

Some Republicans opposed the measure, saying it would punish consumers.

Rep. Gene Ward, R-Hawaii Kai, said Hawaii residents import nearly everything they eat and shouldn’t have to pay more taxes to get what they need.

“Right now, people are still struggling from the recession,” Ward said. “People are still trying to make ends meet.”

Rep. Bob McDermott, another Honolulu Republican, agreed.

“I haven’t had one person come into my office and say, ‘Please, whatever you do this session, tax my online purchases,’” McDermott said.

House lawmakers passed the bill 42-9. It now moves to the Senate.


Cathy Bussewitz can be reached at https://twitter.com/cbussewitz .

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