SB 732 Hawaii Senate · 2026 Regular Session

RELATING TO THE FILM INDUSTRY.

Summary

Requires counties to waive permitting fees for certain film activity. Exempts entertainment payroll companies from the GET. Repeals an income tax exemption for persons engaged in the business of motion picture and television film production for taxable years beginning after 12/31/2023. Amends the Motion Picture, Digital Media, and Film Production Income Tax Credit by providing an additional credit to qualified productions with a workforce of at least eighty percent local hires; requiring productions to contact all local labor unions servicing Hawaii's film industry to qualify for the credit; requiring qualified production costs of a taxpayer that exceed $1,000,000 to be certified by a CPA, rather than via tax opinion; increasing the aggregate cap amount on credits allowed in any given year, ramped down by one-sixth over five years beginning on 1/1/2028; and including broadcast and streaming platform productions under the credit. Applies the GET rate for manufacturers to productions. Exempts from the GET amounts received by a motion picture project employer from a client equal to amounts that are disbursed by the motion picture project employer for employee wages, salaries, payroll taxes, insurance premiums, and employment benefits and payments to loan-out companies. Repeals certain tax exemptions and the Motion Picture, Digital Media, and Film Production Income Tax Credit on 1/1/2033. Appropriates funds. Effective 7/1/3000. (HD2)

Issues: ✓ Budget & Taxes

Bill status passed both 4 of 5 stages cleared

Introduction

Jan 2025

Committee Review

Apr 2025

Senate Passage

Mar 2025

House Passage

Apr 2025

Governor

Introduced Jan 17, 2025 Last action Apr 2, 2026

Maddy AI version diff · 4 comparisons

What changed between versions

SB732_SD1 → SB732_SD2 · 8 edits

MODERATE

This bill updates Hawaii's film industry tax credit laws by adding a new requirement for counties to waive permitting fees for qualified productions and increasing the annual tax credit cap from $50 million to $60 million. It also clarifies definitions to explicitly include streaming and broadcast series, while repealing a provision that allowed unused credit caps to carry over to future years. Additionally, the bill expands the list of eligible production costs and sets a future effective date of July 1, 2050.

Scope change

The bill expands the scope of eligible productions to explicitly include streaming and broadcast series, and it changes the scope of county obligations by mandating fee waivers for qualifying film activities.

REQUIREMENT

Requires all counties to waive applicable permitting fees for film activities conducted on county lands by productions that qualify for the tax credit.

Repeals the provision that allowed unused tax credit caps to be carried over to subsequent years if the annual limit was exceeded.

FISCAL

Increases the annual aggregate cap for film production tax credits from $50 million to $60 million.

DEFINITION

Updates the definition of 'qualified production' to explicitly include television series pilots, single-season series, and ongoing streaming series, and clarifies episode count limits.

Adds a specific definition for 'streaming platform' to clarify eligibility for online media providers.

ELIGIBILITY

Expands the list of eligible 'qualified production costs' to include additional items like lodging for cast and crew, vehicle rentals, and shipping of equipment.

Explicitly lists categories of productions that are NOT eligible for the tax credit, such as news, public affairs programs, and televised sporting events.

TIMELINE

Sets the effective date of the Act to July 1, 2050, with the tax credit changes applying to taxable years beginning after December 31, 2025.

SB732_HD1 → SB732_HD2 · 9 edits

MAJOR

This bill significantly restructures Hawaii's film tax incentive program by repealing the existing income tax credit and replacing it with a new system that waives county permitting fees and exempts entertainment payroll companies from general excise tax. The new framework introduces a higher tax credit for productions with 80% local hiring, requires mandatory contact with local labor unions, and mandates CPA certification for projects over $1 million. Additionally, the bill extends the program's expiration date to 2033 and adjusts the annual credit cap to phase down over time.

Scope change

The bill expands the scope of the incentive to include streaming platform productions and broadens the definition of eligible projects to cover commercials and interactive games, while simultaneously removing the previous income tax exemption for film production companies.

REQUIREMENT

Added a mandatory requirement for productions to contact all local labor unions before starting work to qualify for the tax credit.

Added a requirement for independent CPA certification for qualified production costs exceeding $1 million, replacing the previous tax opinion requirement.

ELIGIBILITY

Modified the tax credit calculation to provide an additional 5% credit for productions that hire at least 80% of their workforce from local residents.

DEFINITION

Removed the income tax exemption for persons engaged in the business of motion picture and television film production.

SCOPE

Added streaming platform series and commercials to the list of eligible productions for the tax credit.

Added a new provision requiring counties to waive permitting fees for qualified film productions on county lands.

FISCAL

Modified the annual aggregate credit cap to start at a higher amount and decrease by one-sixth annually beginning in 2028.

EXEMPTIONS

Added an exemption from general excise tax for gross proceeds of entertainment payroll companies.

TIMELINE

Modified the program's expiration date from 2023 to 2033 and set a new effective date of July 1, 3000.

SB732 → SB732_HD1 · 8 edits

MODERATE

This bill transforms the film tax credit program by establishing a new investment fund to support Hawaii's film industry and expanding eligibility to include streaming platforms and digital media. It introduces stricter requirements for productions, such as contacting local labor unions and hiring at least 80% local talent to qualify for an additional tax credit bonus. The bill also removes the previous $60 million annual cap on tax credits and updates definitions to clarify what qualifies as a 'qualified production' in the modern media landscape.

Scope change

The bill significantly broadens the scope of eligible productions to include streaming series and digital media, while adding new administrative requirements for all qualifying projects.

FISCAL

Created a new 'Island Film and Media Production Investment Fund' administered by a board of trustees to make strategic investments in the industry.

Removed the specific $60 million annual cap on tax credits, replacing it with a blank field allowing the legislature to set a new limit.

ELIGIBILITY

Expanded tax credit eligibility to include streaming platforms and digital media productions, whereas the previous version focused primarily on traditional film and television.

Introduced an incentive offering an additional 5% tax credit for productions that employ a workforce of at least 80% local hires.

REQUIREMENT

Added a mandatory requirement for productions to contact all local labor unions before starting work to qualify for the tax credit.

Mandated that taxpayers spending over $1 million must submit an independent third-party certification from a certified public accountant to claim the credit.

DEFINITION

Added a specific definition for 'streaming platform' to clarify that online providers delivering content via internet connection are included under the program.

TIMELINE

Set the effective date for the Act to July 1, 3000, with the tax credit provisions applying to taxable years beginning after December 31, 2025.

Floor votes

How they voted

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

Full legislative history

Actions timeline

Total actions

Key actions

Committee

Amendments

Apr 25, 2025

Upper · Passed

Conference committee meeting to reconvene on 04-25-25 5:46 PM; Conference Room 225.

upper

Apr 25, 2025

Upper · Passed

Conference committee meeting to reconvene on 04-25-25 4:40 PM; Conference Room 411.

upper

Apr 25, 2025

Upper · Passed

Conference committee meeting to reconvene on 04-25-25 3:00 PM; Conference Room 411.

upper

Apr 25, 2025

Upper · Passed

Conference committee meeting to reconvene on 04-25-25 2:00 PM; Conference Room 411.

upper

Apr 25, 2025

Upper · Passed

Conference committee meeting to reconvene on 04-25-25 11:40 AM; Conference Room 411.

upper

Apr 24, 2025

Upper · Passed

Conference committee meeting scheduled for 04-25-25 8:15AM; Conference Room 411.

upper

Apr 10, 2025

Amended

Senate disagrees with House amendments.

upper

Apr 10, 2025

Introduced

Received from House (Hse. Com. No. 654).

upper

Apr 8, 2025

Lower · Passed

Passed Third Reading as amended in HD 2 with Representative(s) Iwamoto voting aye with reservations; none voting no (0) and Representative(s) Cochran, Marten excused (2). Transmitted to Senate.

lower

Apr 2, 2025

Lower · Passed

The committee on FIN recommend that the measure be PASSED, WITH AMENDMENTS. The votes were as follows: 15 Ayes: Representative(s) Yamashita, Takenouchi, Grandinetti, Holt, Hussey, Keohokapu-Lee Loy, Kitagawa, Kusch, Lamosao, Lee, M., Miyake, Morikawa, Templo, Alcos, Reyes Oda; Ayes with reservations: none; Noes: none; and Excused: none.

lower

Mar 14, 2025

Committee

Re-referred to ECD, FIN, referral sheet 23

lower

Mar 14, 2025

Committee

Reported from ECD (Stand. Com. Rep. No. 1237) as amended in HD 1, recommending passage on Second Reading and referral to JHA.

lower

Mar 12, 2025

Lower · Passed

The committee on ECD recommend that the measure be PASSED, WITH AMENDMENTS. The votes were as follows: 6 Ayes: Representative(s) Ilagan, Hussey, Tam, Templo, Todd, Matsumoto; Ayes with reservations: none; 0 Noes: none; and 1 Excused: Representative(s) Holt.

lower

Mar 6, 2025

Committee

Referred to ECD, JHA, FIN, referral sheet 19

lower

Mar 4, 2025

Introduced

Received from Senate (Sen. Com. No. 187) in amended form (SD 2).

lower

Mar 4, 2025

Upper · Passed

Report adopted; Passed Third Reading, as amended (SD 2). Ayes, 25; Aye(s) with reservations: none . Noes, 0 (none). Excused, 0 (none). Transmitted to House.

upper

Feb 26, 2025

Upper · Passed

The committee(s) on WAM recommend(s) that the measure be PASSED, WITH AMENDMENTS. The votes in WAM were as follows: 13 Aye(s): Senator(s) Dela Cruz, Moriwaki, Aquino, DeCoite, Elefante, Hashimoto, Inouye, Kanuha, Kidani, Kim, Lee, C., Wakai, Fevella; Aye(s) with reservations: none ; 0 No(es): none; and 0 Excused: none.

upper

Feb 20, 2025

Upper · Passed

The committee(s) on WAM will hold a public decision making on 02-26-25 10:03AM; Conference Room 211 & Videoconference.

upper

Feb 11, 2025

Upper · Passed

Report adopted; Passed Second Reading, as amended (SD 1) and referred to WAM.

upper

Feb 11, 2025

Committee

Reported from EDT (Stand. Com. Rep. No. 216) with recommendation of passage on Second Reading, as amended (SD 1) and referral to WAM.

upper

Feb 4, 2025

Upper · Passed

The committee(s) on EDT recommend(s) that the measure be PASSED, WITH AMENDMENTS. The votes in EDT were as follows: 5 Aye(s): Senator(s) DeCoite, Wakai, Fukunaga, Kim, Awa; Aye(s) with reservations: none ; 0 No(es): none; and 0 Excused: none.

upper

Jan 30, 2025

Upper · Passed

The committee(s) on EDT has scheduled a public hearing on 02-04-25 1:00PM; Conference Room 229 & Videoconference.

upper

Jan 23, 2025

Committee

Referred to EDT, WAM.

upper

Jan 17, 2025

Introduced

Introduced.

upper

1 primary · 0 co-sponsors