Court Opinion

ID: 9530978
Source: CourtListenerOpinion
Date Created: 2023-08-07 04:06:01.81789+00
Date Added: 2024-06-11T13:28:18.594965
License: Public Domain

CONCURRING OPINION OF
ABE, J.
I agree with the majority of this court that the interstate commerce clause does not prevent Hawaii from taxing the gross income of the travel agencies. And I agree with the court that even if the travel agencies have established a violation of the Equal Protection Clause, we should not order a refund of all taxes collected under HRS § 237-13(6).
I think, however, that we should admit that a violation of the Equal Protection Clause has occurred. Equal protection analysis requires us to determine whether two taxpayers have, without a rational basis, been classified differently.
Here, the Director of Taxation has treated travel agencies and airlines,1 both of whom would appear to be liable for *430the tax in question, in a different fashion. He has assessed a tax against travel agencies but made no attempt to collect from airlines.
No rational basis has been offered to explain the difference. The Director has not argued that he has insufficient staff to prosecute all persons who might be liable for the tax. He has not argued that the failure to tax the airlines was an error, which he would attempt to rectify in the future. And he has not attempted to establish that the airlines are not subject to the tax. Instead, he offers no explanation whatsoever for the differential treatment.
I agree with this court, however, that the fact that an Equal Protection violation has occurred here does not dictate that we should order the Director of Taxation to refund all monies collected under the Act. Of course, an order refunding the taxes or a portion of the taxes of the'appellees in this case, or awarding them attorney’s fees would not be so unreasonable, and would have the virtue of encouraging suits that would uncover arbitrary action by the Director of Taxation, something which could never be accomplished by relegating the agencies to a writ of mandamus. However, I believe that though such a remedy would cure the Equal Protection violation, it would be an injudicious exercise of our discretion.
In any event, I think this court in this proceeding should issue a writ of mandamus ordering the Director of Taxation to attempt to collect the tax from airlines for all open years. I believe that though the agencies’ complaint sought only a refund of their own taxes, that factor does not prevent this court from issuing such a writ under Rule 54(c) of the Haw. Rules of Civ. Pro. which clearly provides that “every final judgment shall grant the relief to which the party in whose favor it is rendered is entitled, even if the party has not demanded such relief in his pleadings.” If there is ever a case in which that rule should be.invoked, it is this case.

As to commission or other consideration received by an airline from sale of tickets on another airline, or for making hotel or surface transportation accommodations.