SB1495 amends Hawaii’s general excise tax law to add an exemption for gross receipts from the sale of hearing aids when sold by a hospital, infirmary, medical clinic, health care facility, pharmacy, or a practitioner licensed to administer drugs to an individual. The bill places hearing aids alongside existing exempt sales of prescription drugs and prosthetic devices in section 237-24.3 of the Hawaii Revised Statutes.
The measure is framed as a targeted tax relief bill for hearing aid purchases, which may reduce the tax burden on consumers obtaining hearing aids through medical and pharmacy channels and on the providers that collect and remit the tax on those sales. The bill also includes a delayed effective date of December 31, 2050, but a sunset clause that repeals the act on January 1, 2027, meaning the exemption is intended to be temporary unless later extended or reenacted.
Impact
The bill would amend section 237-24.3, Hawaii Revised Statutes, to expand the list of amounts not subject to the general excise tax by expressly including hearing aid sales made through specified health care and pharmacy providers. In practical terms, this changes state tax treatment for those transactions and may lower out-of-pocket costs for hearing aid purchasers while reducing general excise tax collections from the affected sales. The bill does not alter the definition of hearing aid, instead incorporating the existing definition in section 451A-1.
Sentiment
The available voting history suggests generally favorable sentiment. The Senate Health and Human Services Committee passed the bill unanimously, 4-0, with amendments, and the measure advanced on second reading. The committee referral pattern also indicates it was treated as a health-related tax relief proposal rather than a controversial revenue measure.
Contention
No committee transcript is available, so there is no recorded debate to identify specific objections. The main policy issue implied by the bill is whether hearing aids should receive the same tax exemption treatment as other medically necessary devices and prescription-related sales. Any contention would likely center on the revenue impact of the exemption, the temporary nature of the measure, and whether the exemption should be limited to sales through certain providers rather than all hearing aid transactions.