May 21, 1993


RE:  Use Tax Reports by Motor Vehicle Dealers

Effective July 1, 1993, Act 45, Session Laws of Hawaii 1993, requires motor vehicle dealers, as defined by Section 437-1.1, Hawaii Revised Statutes, (licensed with the Department of Commerce and Consumer Affairs) to submit a report to the Director of Taxation for all motor vehicles delivered to customers in the prior month as a "courtesy delivery". The report must contain the following information:

  1. Name and address of the dealer making the "courtesy delivery".
  2. Name and address of the seller of the motor vehicle.
  3. Description of the motor vehicle (type).
  4. Landed value of the motor vehicle.  Landed value includes the cost of the vehicle to the purchaser, freight, insurance, and any other charges to land the vehicle in Hawaii, less (1) trade-in allowance for old motor vehicle if traded in Hawaii, (2) charges for license plates outside Hawaii, (3) sales tax paid outside Hawaii, (4) depreciation, if applicable.
  5. Name and address of the purchaser or importer of the motor vehicle.
  6. Date of importation into Hawaii.  Other information may be requested by the Director of Taxation at a later date.
The term "courtesy delivery" relates to the preparation for delivery and the delivery in Hawaii by a motor vehicle dealer of a motor vehicle imported into the State by a person who purchased the motor vehicle from an out-of-state manufacturer or an out-of-state dealer. A "courtesy delivery" does not apply to motor vehicles sold by the in-state dealer.

The purchaser or importer of the vehicle is subject to Hawaii use tax on the motor vehicle imported into Hawaii. The use tax at the rate of 4 percent of the landed value of the motor vehicle is applicable when the vehicle is used by the importer or purchaser for personal or business purposes. The in-state dealer making the "courtesy delivery" is not considered the importer of the vehicle and not subject to the use tax on the vehicle so delivered to the purchaser or importer.

The use tax report must be sent to the Department of Taxation to the attention of the following:

Collections Division - Non-filers Unit
Department of Taxation
P. O. Box 259
Honolulu, Hawaii 96809


Director of Taxation