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Alternative Budget, Pension Tax, Higher GE Tax, Production Studio Credits

April 21, 2011
Maui Weekly

Alternative Budget - The minority caucus in the House has worked hard this year to create and propose an alternative budget that does not raise taxes. This budget can be viewed and downloaded at www.hawaiistatebudgetonline.com. The public is invited to download the minority caucus budget and interactively work with it.

Unfortunately, there are a number of bills still alive that will raise your taxes:

Pension Tax - HB 1092 HD1 SD will tax pensions. The current amended bill begins to tax “a taxpayer’s pension income in excess of $100,000.” Although this may not affect a high percentage of retirees presently, the public needs to be aware that this opens the door to the pension taxation for all citizens of Hawai‘i. This is problematic for the seniors in our state, since most retirees do not have the option to go back to work to make up lost income.

Higher GE Tax - HB 793 SD1, in its earlier version, would have raised the general excise (GE) tax by one percent. In the present form, this bill suspends certain GE tax credits. Keep an eye on this one, because there could be an effort to raise the GE tax again. The GE tax is a pyramiding tax that affects everyone in our society, including the poor. An increase in the GE tax is bad for the economy because some businesses may have to lay off employees. Many businesses will also have to increase their prices to cover the increase in the tax.

On a positive note, there is a bill that encourages investment and jobs on Maui.

Production Studio Credits - HB 1551 HD2 provides a tax credit for qualified media infrastructure projects. This bill will provide a 20 percent tax credit for studios related to film and TV production on the Neighbor Islands. This is a way to increase film industry investment in Hawai‘i. Maui County has a real opportunity to attract film and television production company investment, which would mean more jobs and more spending to help our local economy.

If you need to contact me with any issues or concerns regarding South Maui, please call my office at (808) 586-8525 or email repfontaine@capitol.hawaii.gov.

 
 

 

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