State can tax Boat's Business (but not the Boat)
In re Tax Appeal of Reel Hooker Sportfishing (ICA May 28, 2010) Background. Reel Hooker Sportfishing, Exact Game Fishing, Inc., and Finest Kind, Inc. are corporations that run charter boats around Maui, Lanai, and Molokai. They had federal permits allowing them to travel through the navigable waters between the islands. They are in the charter fishing business and allow passengers to seek pelagic game fish like marlin , ono , ahi , and mahimahi . Their source of earnings come from the fares charged to passengers. These fares include the state's general excise tax, the GET. The boat companies filed complaints against the State in the Tax Appeal Court alleging that the GET tax was preempted by federal law. The Tax Appeal Court granted the State's motion for summary judgment. The boat companies appealed. The Three Faces of Federal Preemption. The ICA addressed a single issue, whether the federal statute, 33 U.S.C. § 5(b) preempts Hawai'i's GET tax, HRS § 23...