Council Should Reject Bill 40 And Not Raise General Excise Tax

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”’Editor’s Note: The following comments were made on July 6, 2005, by Honolulu Council Member Charles Djou at the second reading of Bill 40, which would allow the Honolulu City Council to raise the General Excise Tax 12.5 percent. In this Battle of Ideas, see the remarks by Council Member Gary Okino at:”’ “In Support of the General Excise Tax to Fund a Rail System”

“Charles Djou Image”


I can’t let this pass without a little bit of discussion.
I’m speaking in opposition to Bill 40 proposing to raise the general excise from 4 to 4.5 percent.

Mr. Chairman and colleagues, I know we have a tough slog with this particular legislation.

I’m hoping eventually some of my points sink in with a number of you.
First point I’d like to reiterate is this is the largest tax increase in the history of hawaii.

It’s going to suck $450 out of every family in our community.

I’ve stated it before, the people are not an endless cash machine.
We cannot continue to go back to the people and hit them up for more and more and more taxes every time we have a project that we fancy.

This tax will damage our economy.

The general excise tax is a particular tax that goes through all sectors and will damage the long-term growth of our community here in the city and county of Honolulu.

Third, this tax is regressive.

The wealthy will pay less than the poor.

This is very different from the proposal we looked at 13 years ago,
where at least that proposal 13 years ago had provisions and a tax break for the poor and the less well off in our community.

And fourth, I’d like to point out to colleagues we have raised taxes too often, too many times before in the past.

Again, I remind everyone over the last two years, we raised the vehicle tax twice so it’s doubled from what it was two years ago.

We have raised commercial tax rate twice, we have raised the residential rate, sewer fees.

We have raised fees for garbage tipping, raised fees for parks.

We have raised the fees for the Blaisdell, Waikiki Shell, Hanauma Bay.
Everywhere we raised taxes.

It will be one thing if this were a one-time hit upon the public that just this tax increase and only this tax increase but unfortunately it is not.

We have raised pretty much every other fee in the books and now we’re piling on top of that the largest tax increase in the history of our state.

For these reasons alone should be enough to reject Bill 40.

But if that weren’t enough, I would like to reiterate to my colleagues what has transpired with this particular legislation over the past several weeks.

Unfortunately, what it appears to me and many members of the public, we have no idea what the heck we’re doing.

The chaos, the confusion coupled with the confusion with the veto and the override shows to the public that we do not really have a solid plan and a solid clear agenda of what we’re proceeding with this massive tax increase.

One would think that before we pass the largest tax increase in the history of Hawaii, that we would first at least have a plan.
But unfortunately we do not.

One would think before we undertake the biggest public works project the state has ever seen, we would have some idea about the plans and designs.
Unfortunately, we do not.

The bottom line is that we have no idea what the size, scale, or scope of this project.

I ask the members of the public and all of the people listening and watching, what is going on is we’re basically ask you to say, trust us.

Trust us that we’re going to suck out $45,000 each and every year for the next decade and a half and trust us that, yeah, we’re going to spend it right.

Trust us despite the fact we’re offering you no plans, no designs we’re going to come up with something, somehow, somewhere along and spend your money wisely.

I ask the public, would you purchase from a salesman any product for $500 — forget that, $5,100 where the salesman tells you you can’t look at the product? I’m going to just vaguely describe what this product is going to do but trust me anyway.
Fork over your money and some time in the future I’ll give that product to you.

Unfortunately, that is exactly what’s going on with Bill 40. We’re asking the public to reach in their wallets and we’ll suck up $450.
And we’re not offering them any coherent project or plans.
The only assurance the public has is somehow this is all into some special trust fund.

I remind them, the trust fund has a history of getting raided.
The highway fund or sewer funds, which were supposed to have the solid boxes, have been raided into the tune of hundreds of thousands of millions of dollars.

This proposed tax increase is much too large that people cannot afford it.

Because we have no idea of what we’re doing, we should firmly reject this.

Thank you.

”’Charles Djou is the Honolulu City Council member representing Hawaii Kai, Kuliouou, Niu Valley, Aina Haina, Wailupe, Waialae-Iki, Kalani Valley, Kahala, Wilhemina Rise, a portion of Kapahulu, a portion of Kaimuki, Diamond Head, Waikiki, and a portion of Ala Moana. He can be reached by phone at 547-7004 or via email at:”’

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