Governor Lingle Proposes
New Transportation Taxes
Governor Linda Lingle announced a comprehensive six-year highways modernization proposal that will cost $4.2 billion to implement. The plan includes a $2 billion increase to various highway taxes and fees which I will oppose. Please be advised these hikes are in addition to other taxes as there may be additional federal and local tax hikes.
Under the proposal the state fuel tax would increase from $0.17 per gallon to $0.27. That is a 59% increase per gal-lon. An average fill up of 10 gallons would be an additional dollar. It is estimated that this tax boost will have annual revenues of $51 million.
Vehicle weight taxes are also expected to be raised. Cur-rently set at 3/4 of a cent per pound for vehicles up to 4000 pounds, the new rate would be 23/4 cents per pound, or a 266% increase. A 3000 pound vehicle owner would pay an additional $60 per year in weight taxes. This revenue will generate $68 million more in yearly revenue.
Increases in the motor vehicle registration fees are pro-posed as well. The $25 a year state fee is set to be raised to $45 per year, or an additional 80%. The extra $20 per year increase is predicted to raise a further $23.3 million of revenue for each year.
The final tax increase anticipated is raising the rental vehi-cle surcharge from $3 per day to $5 per day. This 66% in-crease of $2 daily would cost a weekly renter $14 more for their trip. Annual intake on this increase is predicted to be $32 million.
Hawaii taxpayers will be financially impacted by an addi-tional $170 in new taxes per year if this proposal passes.
The revenues raised would be placed in a special fund and would not take effect until Hawaii has experienced two con-secutive quarters of 1 percent job growth. Furthermore the Governor has also stated that the increases will kick in af-ter she leaves office in late 2010.
The new tax increases are being earmarked for a number of state highways and road improvements. The additional taxes will be placed on top of the increased General Excise Tax authorization that was approved without the Governor's signature in 2005. That tax increase is being applied to the City & County's $7 billion fixed rail project.
As I have mentioned numerous times before, I remain com-mitted to oppose any tax increase that places more burden on taxpayers, tourists and businesses.


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