New Taxes Proposed by Legislature Tally More Than $430 Million-Public Outcry Falling on Deaf Democrat Ears, Governor Asks Public to Back Her

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Democrats in the Hawaii state Legislature are proposing to raise taxes on a variety of fronts, even though Hawaii taxpayers already pay the fourth highest taxes in the nation, and the economy and businesses continue to suffer under the state’s and city’s repressive tax and spend policies.


The tax proposals are still alive and likely to cross over to the other respective House today — crossover — despite tremendous public outcry coming in over phones, faxes and emails of legislators and on the Hawaii radio airwaves.

At a Republican minority “No New Taxes” press conference at the state Capitol Friday, around 100 people showed up to support the Republican legislators and join them in their rally cry for “No New Taxes.”

In two weeks, KHVH Radio Morning Talk Show Host Rick Hamada is planning a full-fledged rally during one of his morning live broadcasts, much like the one he coordinated in 1998 when then Gov. Benjamin Cayetano proposed a general excise tax hike.

Some of the proposals still alive in the Hawaii state Legislature:

*The state Senate passed a measure to increase the general excise tax by 12.5 percent, from 4 percent to 4.5 percent, to raise $180 million from Hawaii taxpayers, supposedly to put $120 million into education, though there is no guarantee the money will be used for education. Now the measure is before the state House. The House leadership says the measure will not pass, but those who know how the Legislature operates say no issue is dead until the close of the Legislative session at midnight, May 1, 2003.

*The state House proposed a measure to allow the Honolulu county to impose an additional sales tax of 1 percent. Gov. Linda Lingle has said she will approve the bill based on her view that she wants to give counties autonomy on all fronts, including tax options, though she says she is opposed to tax increases. Opponents say the city already has taxing powers on property and substantial revenue from fees charged for services and vehicles, and that the city should not be given additional taxing powers because the mayor has not been responsible with the money he already has.

*House and Senate Democrats say they want to pass a $10 per person per month tax on everyone from ages 25 to 99 to create a state-subsidized long-term health-care fund to care for the aging population in Hawaii. This $10 is just the start. Lawmakers plan to increase that monthly tax rapidly once the program is in place. And no one escapes — even if they leave Hawaii — so long as they own property or a business here, or work here, they will pay. Opponents say the “progressive tax,” which increases by an undetermined amount every year, will not work because there will not be enough money to pay for the long-term care of the people who are forced to pay into it. They say it is better for the community if people are given tax credits and other benefits for investing in their own long-term care private options, and let the truly poor rely on the state and federal government should they need long-term care. Gov. Linda Lingle, who maintains she will not support tax increases in Hawaii, calls this tax proposal the “cruelest of all.” That is because the tax program does not take into account anyone’s income, rather imposes a flat tax on everyone, and because it supposedly provides long-term care coverage for those in need, but will not actually do so because there will not be enough money, she says. The governor also says the money will create a “super fund” that legislators will raid to balance the state budget, as has happened historically with the state retirement fund, hurricane relief fund, rainy day fund, transportation fund and other special funds.

*The House and Senate are proposing an increase in the state’s conveyance tax and many other tax increases that have received little attention by the public and media.

Many people, including small business owners, at first were not too concerned about the tax increases the majority party in the Legislature is planning to pass because they believed the governor would veto these bills.

However, Democrats in the Legislature already say they are planning to override the governor’s vetoes — even though they have historically not overridden any governor’s vetoes (all Democrat governors) since statehood, with the exception of one under Cayetano. This is their way of challenging the governor’s authority — especially as she is the first Republican governor in 40 years and the first-ever woman governor.

With the realization the Democrats are plotting an override, many people are starting to rally against the proposed increases and have contact with their concerns, asking what can be done to stop the Legislative majority party from passing these tax increase bills.

The best advice likely came from the governor herself this morning on KHVH radio. She asked the public to contact their legislators through phone calls, emails, faxes and personal visits, to tell them to kill the tax increase bills and to support her education reform and government accountability legislation.

To contact legislators, click here “Representatives at a Glance” and “Senators at a Glance.”

Click here to get to the governor’s Web site at:

Or to contact Gov. Linda Lingle:

Please address correspondence to: Honorable Governor Linda Lingle, Executive Chambers, State Capitol, Honolulu, Hawaii, 96813

*Phone: (808) 586-0034
*Fax: (808) 586-0006