HB 1937 Hawaii House · 2026 Regular Session

RELATING TO TAXES.

Summary

Excludes the sale of a motor vehicle to a lessor of rental motor vehicles for use as a rental motor vehicle as a sale at wholesale. Imposes the maximum allowable excise tax on the use of tangible personal property in the State for the importation or purchase of a motor vehicle by a lessor of rental motor vehicles for use as a rental motor vehicle. Establishes a Teacher Temporary Hazard Pay Special Fund to pay a temporary hazard pay bonus to certain eligible teachers. Beginning 7/1/2026 until 7/1/2030, deposits the additional tax revenue generated by this Act into the Teacher Temporary Hazard Pay Special Fund. Effective 7/1/3000. Sunsets 7/1/2030. (HD1)

Bill status passed 3 of 5 stages cleared

Introduction

Jan 2026

Committee Review

Feb 2026

House Passage

Feb 2026

Senate Passage

Governor

Introduced Jan 23, 2026 Last action Feb 20, 2026

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What changed between versions

HB1937 → HB1937_HD1 · 6 edits

MODERATE

HB 1937 was amended to address tax equity and revenue gaps by modifying how rental motor vehicles and out-of-state contractors are taxed. The bill now explicitly finds that rental car operators should pay retail-level taxes when vehicles are not resold in Hawaii, and it strengthens enforcement for unregistered federal contractors. Additionally, the bill establishes a special fund to finance teacher hazard pay, with a sunset provision that reverts the tax changes in 2030.

Scope change

The bill's scope expanded to include specific findings on rental motor vehicle tax equity and out-of-state contractor compliance, while the effective date was significantly altered to 2030 with a sunset clause.

SCOPE

Added legislative findings stating that rental motor vehicle lessors should contribute equitably to state infrastructure, particularly when vehicles are not resold in Hawaii.

ENFORCEMENT

Added findings requiring better registration and tax remittance by out-of-state federal contractors working in Hawaii.

DEFINITION

Modified the definition of 'Wholesaler' in tax statutes to clarify tax treatment of rental motor vehicles.

REQUIREMENT

Amended tax statutes to impose maximum excise taxes on the use of tangible personal property by rental motor vehicle lessors.

FISCAL

Established a Teacher Temporary Hazard Pay Special Fund to receive additional tax revenues generated by the new provisions.

TIMELINE

Changed the effective date from July 1, 2026, to July 1, 3000, and added a sunset provision to repeal the Act and restore original statutes on July 1, 2030.

Floor votes

How they voted

This bill passed the House by voice vote (no roll call recorded).

Full legislative history

Actions timeline

Total actions

Key actions

Committee

Feb 20, 2026

Lower · Passed

Report adopted; referred to the committee(s) on FIN with Representative(s) Gedeon, Matsumoto, Reyes Oda voting aye with reservations; Representative(s) Alcos, Garcia, Muraoka, Pierick, Shimizu voting no (5) and Representative(s) Quinlan excused (1).

lower

Feb 20, 2026

Committee

Reported from EDN (Stand. Com. Rep. No. 699-26), recommending referral to FIN.

lower

Feb 19, 2026

Lower · Passed

The committee on EDN recommend that the measure be PASSED, UNAMENDED. The votes were as follows: 9 Ayes: Representative(s) Woodson, La Chica, Evslin, Garrett, Kapela, Kila, Souza; Ayes with reservations: Representative(s) Amato, Olds; 1 Noes: Representative(s) Muraoka; and 0 Excused: none.

lower

Feb 12, 2026

Committee

Reported from TRN (Stand. Com. Rep. No. 213-26) as amended in HD 1, recommending passage on Second Reading and referral to EDN.

lower

Feb 10, 2026

Lower · Passed

The committee on TRN recommend that the measure be PASSED, WITH AMENDMENTS. The votes were as follows: 7 Ayes: Representative(s) Kila, Miyake, Evslin, Grandinetti, Kitagawa, La Chica; Ayes with reservations: Representative(s) Cochran; 2 Noes: Representative(s) Muraoka, Pierick; and 0 Excused: none.

lower

Jan 28, 2026

Committee

Referred to TRN, EDN, FIN, referral sheet 3

lower

Jan 26, 2026

Introduced

Introduced and Pass First Reading.

lower

Jan 23, 2026

Introduced

Pending introduction.

lower

10 primary · 0 co-sponsors