Over the years, I've purchased antibiotics, heartworm and flea medication and the vets charged the general excise tax on all those prescriptions. But I noticed Longs does not charge the tax on prescriptions for my husband and me. I asked the pharmacist and she said Hawaii exempts prescription drugs from that tax.
I researched this further and found Hawaii law, Chapter 237 on the general excise tax, does indeed exempt prescription drugs. I suspect thousands of Hawaii pet owners have been charged the tax on prescriptions for their pets. Can you look into this?
ANSWER: Hawaii law clearly prohibits pharmacies from passing the general excise tax along to consumers when they buy prescription drugs.
The state Department of Taxation, however, interprets that to apply to prescriptions for humans, not prescriptions for animals.
Tax officials cite key words that refer to selling or administering drugs "to an individual." An individual is generally understood to be a person; it's fairly clear this was intended only for drugs for people, said Linn Garcia, acting technical review officer at the tax department.
"It is our understanding that the intent (of lawmakers who) enacted this provision was to bring down the costs of medical care for the people of Hawaii," Garcia said.
The situation is a bit confusing because the general excise tax law has been amended several times and because it also makes references to other sections of Hawaii law dealing with food, drugs and cosmetics.
In those sections, the definition of prescription drugs has references to animals as well as people.
Sue-Ann Yasuoka, executive director of the Hawaii Pharmaceutical Association, said pharmacists interpret the law as meaning the general excise tax cannot be passed along on medication for humans but may be passed along on medication for animals.
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