A new law requires Hawaii tax refunds to be sent to taxpayers within 90 days, or else the state would pay interest on delayed refunds.

Gov. Linda Lingle signed the measure into law today.

The state law requires the state government to pay monthly interest at a rate of one-third of 1 percent of the refund amount if a tax overpayment isn’t refunded within 90 days.

The Legislature passed House Bill 1948 unanimously in April in response to the Lingle administration’s move to delay payment of this year’s refunds so the state could save about $294 million on paper.

Improved tax collections allowed the state to pay out $124 million worth of refunds already, but the remaining $170 million won’t be mailed until the new fiscal year begins in July.