House Contingent Opposes Tax Increase Recommendations

State Capitol. Photo by Wendy Osher.

By Wendy Osher

Maui representatives Kyle Yamashita and Mele Carroll are among a group of House members voicing opposition to a consultant report that seeks tax increases, including a 0.5% increase in the general excise tax.

The recommendations are scheduled to be heard today before the Tax Review Commission.

Opponents say such a significant net tax increase would likely be detrimental to private businesses, residents, or both. A joint statement released by House members opposed to the recommendation also claims, “PFM has not sufficiently analyzed the impact of the tax increase on the economy, businesses, and residents.”

The recommendations, prepared by The PFM Group for the 2010-2012 Tax Review Commission, is scheduled to be heard in a public hearing today.

The hearing will cover a draft report entitled “Study of the Hawaii Tax System: Final Report.”

Aside from the general excise tax rate increase request, the recommendation also calls for an imposition of the income tax on pension income; an increase of the corporate income tax rate; and the elimination of the income tax deduction for real property taxes paid.

Testimony in opposition was submitted on behalf of the following members: Henry J.C. Aquino, Karen Awana, Tom Brower, Rida T.R. Cabanilla, Mele Carroll, Pono Chong, Isaac W. Choy, Ty Cullen, Heather H. Giugni, Sharon E. Har, Mark J. Hashem, Robert N. Herkes, Linda Ichiyama, Ken Ito, Jo Jordan, Derek S.K. Kawakami, Marilyn B. Lee, Sylvia Luke, Dee Morikawa, John M. Mizuno, Mark M. Nakashima, Marcus R. Oshiro, Calvin K.Y. Say, James K. Tokioka, Clift Tsuji, Gregg Takayama (Representative-Elect), Ryan I. Yamane, Kyle T. Yamashita, and Jessica Wooley.