2023 Hawaii Revised Statutes › Title 14. Taxation › 238. Use Tax Law › 238-3 Application of tax, etc.

§238-3 Application of tax, etc.
(a) The tax imposed by this chapter shall not apply to any property, services, or contracting or to any use of the property, services, or contracting that cannot legally be so taxed under the Constitution or laws of the United States, but only so long as, and only to the extent to which the State is without power to impose the tax.
To the extent that any exemption, exclusion, or apportionment is necessary to comply with the preceding sentence, the director of taxation shall:
(1) Exempt or exclude from the tax under this chapter, property, services, or contracting or the use of property, services, or contracting exempted under chapter 237; or
(2) Apportion the gross value of services or contracting sold to customers within the State by persons engaged in business both within and without the State to determine the value of that portion of the services or contracting that is subject to taxation under chapter 237 for the purposes of section 237-21.
(b) The tax imposed by this chapter shall not apply to any use of property, services, or contracting the transfer of which property, services, or contracting to, or the acquisition of which by, the person so using the same, has actually been or actually is taxed under chapter 237.
(c) The tax imposed by this chapter shall be paid only once upon or in respect of the same property, services, or contracting; provided that nothing in this chapter contained shall be construed to exempt any property, services, or contracting, or the use thereof from taxation under any other law of the State.
(d) The tax imposed by this chapter shall be in addition to any other taxes imposed by any other laws of the State, except as otherwise specifically provided herein; provided that if it be finally held by any court of competent jurisdiction, that the tax imposed by this chapter may not legally be imposed in addition to any other tax or taxes imposed by any other law or laws with respect to the same property, services, or contracting, or the use thereof, then this chapter shall be deemed not to apply to the property, services, or contracting, or the use thereof under such specific circumstances, but such other laws shall be given full effect with respect to the property, services, or contracting, or use.
(e) The tax imposed by this chapter shall not apply to any use of property exempted by section 238-4.
(f) The tax imposed by this chapter shall not apply to any use or consumption of aircraft and vessels, the transfer of which aircraft or vessel to, or the acquisition of which by, the person so using or consuming the same, or the rental for the use of the aircraft or vessel, has actually been or actually is taxed under chapter 237.
(g) The tax imposed by this chapter shall not apply to any intoxicating liquor as defined in chapter 244D and cigarettes and tobacco products as defined in chapter 245, imported into the State and sold to any person or common carrier in interstate commerce, whether ocean-going or air, for consumption out-of-state by the person, crew, or passengers on the shipper's vessels or airplanes.
(h) The tax imposed by this chapter shall not apply to any use of vessels constructed under section 189-25 prior to July 1, 1969.
(i) Each taxpayer liable for the tax imposed by this chapter on property, services, or contracting shall be entitled to full credit for the combined amount or amounts of legally imposed sales or use taxes paid by the taxpayer with respect to the same transaction and property, services, or contracting to another state and any subdivision thereof, but the credit shall not exceed the amount of the use tax imposed under this chapter on account of the transaction and property, services, or contracting. The director of taxation may require the taxpayer to produce the necessary receipts or vouchers indicating the payment of the sales or use tax to another state or subdivision as a condition for the allowance of the credit.
(j) The tax imposed by this chapter shall not apply to any use of property, services, or contracting exempted by section 237-26 or section 237-29.
(k) The tax imposed by this chapter shall not apply to any use of air pollution control facility exempted by section 237-27.5. [L 1965, c 155, pt of §2 and c 201, §41; Supp, §119-3; am L 1966, c 28, §5; am L 1967, c 34, §1; HRS §238-3; am L 1969, c 181, §1; am L 1970, c 134, §2 and c 180, §16; am L 1979, c 74, §2; am L 1985, c 16, §9; gen ch 1985; am L 1992, c 305, §2; am L 1993, c 220, §5; am L 1999, c 70, §5; am L 2000, c 198, §10; am L 2011, c 32, §2; am L 2018, c 183, §5]
Note
The 2018 amendment applies to taxable years beginning after December 31, 2018. L 2018, c 183, §7.
Cross References
Exemptions, see § §237-26, 237-29.
Case Notes
Where comparison between out-of-state taxpayer and its in-state counterpart shows tax advantage to the former, such taxpayer has no ground to complain that tax violates the commerce clause or subsection (a). 58 H. 163, 566 P.2d 1091 (1977).
Item ordered by exempt organization from out-of-state suppliers for direct delivery to persons in Hawaii were subject to tax. 65 H. 199, 649 P.2d 1126 (1982).