Tax Bills Will Increase Costs for Everyone

Dozens of tax increase bills crossed over from both the House and Senate on Thursday, March 12. Some are still alive as we head into the second crossover this coming Tuesday, April 14. Others like the GE Tax increase have stalled and are considered "dead".

I voted "no" on all the tax and fee increase bills that came up for Third Reading in the Senate and will do the same to all House bills that make it to committee or final votes. Among the very nasty tax bills being considered are the following:

SB 1346 - Increases the General Excise Tax to fund public education but exempts groceries, medical expenses and a portion of rent from the GE tax. This bill barely passed Third Reading in the Senate with 14 votes in favor, 5 against and 6 excused.

SB 1678 ‚ The so-called "Streamline Tax" bill, which will tax all out-of-state Internet and mail order purchases. Passed out of the Senate 20 to 3 with 2 excused.

SB1611 ‚ This proposes raising the following highway use taxes: liquid fuel by 10 cents per gallon; state vehicle regis-tration fee by $20; rental motor vehicle surcharge tax per-manently to $5 per day; and increase vehicle weight tax. Passed 23 to 2 with the minority voting "no". There are sev-eral other bills that I also voted "no" that raises only the rental vehicle surcharge. HB 1167 mirrors this bill.

SB38 ‚ Increases the tobacco tax on products other than cigarettes from 40% to 60% of the wholesale price and de-posits 33.3% of the proceeds collected into the community health centers special fund.

SB 199 - Sunsets and repeals all tax credits.

SB1111 ‚ Increases the rate of the transient accommoda-tions tax beginning on July 1, 2009.

SB 1230 - Authorizes a tax on individuals and entities that transfer a stock ownership interest in a legal entity that owns real property located in Hawaii.

Some of the tax and fee increase bills that crossed over from the House include:

HB 39 - adds a $5 surcharge to fees charged by state agencies for certain services.

HB 560 - A new tax on liquor with funds going to new special fund for Veteran's Services.

HB 1175 - Increasing the cigarette tax to 20 cents per cigarette.

HB 1271 - a tax increase collected on each barrel of petro-leum product sold by a distributor.

HB 1518 - Authorizes vehicle towing companies to add GET to owners who leave a vehicle unattended on private or public property.

HB 1728 - Will allow administrative agencies the flexibility to increase fees.

HB 1735 - Advances the date of filing of a general excise monthly tax return from the last day of the calendar month following the month in which the taxes accrue to the 20th day of that month to generate a one-time windfall in reve-nue due to earlier collection of taxes within the fiscal year.

HB 1744 - Suspends the distribution of TAT revenues to the counties for 6 years.

HB 1747 - Increases the income tax rate for income brackets of over $100,000.

HB 1749 - Makes the insurance premium tax applicable to mutual benefit societies and health maintenance organizations. Provides for a graduated, escalating tax rate.

What many legislators fail to realize is that all of the tax increases if passed have a very bad cumulative effect on individuals as well as businesses, organizations and visi-tors. It is bad enough that we have these tax increase pro-posals on the table. It will be worse if one or more of these pass and become law on top of the tax increases mandated by the State in the recent past as well as new ones being proposed by both the Federal and County governments.

If anything, the state needs to do more belt tightening like families and small businesses finding new ways of funding or possibly cutting programs. Hawaii should not be among the most taxed states in the nation forever.

Small Business Administration awardees for 2009 were honored at State Senate chambers on March 25. Honorees who were present for the floor presentation in-cluded Phil Kahue, Barbara Haliniak, Tim Moore, Melissa Pavlicek, Agnes Reyes, Jean Jeremiah, Judy Aranaydo, Richard Xie, Michael Fairall, June Arakawa, Naomi Hazelton-Giambrone and Jayne Kim (seated). Senators standing included Galuteria, Sakamoto, Espero, Slom, Chun-Oakland, Baker, Tokuda and Fukunaga.

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