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Committee hears mixed views on tax exemption for nonprofit school fundraisers; decision deferred
Summary
HB 1437, which would create a general excise tax exemption for sales that benefit nonprofit schools, drew support from independent schools and some community members and opposition from a teachers' union worried about private school advantages; the committee deferred the bill.
House Bill 1437, HD2, which would establish a general excise tax exemption on gross proceeds received from sales of commodities or services that benefit nonprofit schools, was discussed by the Senate Committee on Education and deferred.
Supporters from the Hawaii Association of Independent Schools said the exemption would align treatment of independent school fundraisers with existing exemptions for public school fundraisers and that most fundraiser proceeds function as donations. "Almost all of the funding that is raised from these... fundraisers that schools run are just another form of a donation," said Phil Bossert, Executive Director of the Hawaii Association of Independent Schools (HAIS).
The Department of Taxation provided a revenue estimate range in supplemental remarks, noting estimated revenue impacts over several years (the department presented figures during the hearing for fiscal years 2026–2031). Opponents, including a representative of Title I teachers, said the timing of a private school tax break is problematic given current federal funding uncertainty and potential strains on public school resources.
The committee chair recorded the recommendation to defer HB 1437 for further consideration.
Votes at a glance: HB 1437, HD2 — Committee recommendation: defer (as recorded in the hearing transcript).
