§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.



Any provision of law to the contrary
notwithstanding, exemptions or exclusions from tax under this chapter allowed
on or before April 1, 1978, under the provisions of the Constitution of the
United States or an act of the Congress of the United States to persons or
common carriers engaged in interstate or foreign commerce, or both, whether
ocean-going or air, shall continue undiminished and be available thereafter.



(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 tangible personal 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 such 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]



 



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) of
this section.  58 H. 163, 566 P.2d 1091.



  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.