Capitol View

By Richard Borreca

Wednesday, April 10, 1996

The tax man cometh and his name is Ray

WITH any luck, by the end of this month, we all will have settled up with the state and federal government. Hawaii's taxman-fearing procrastinators are using this week to bear down on that mound of canceled checks, scraps of paper and credit card receipts that chart our financial path through 1995. We bought the yearly calculator, arranged the stacks of papers and made several solemn vows to get everything in the mail by Saturday, at the latest.

But what about the other side of the local receiving line: the man at the top of the state tax department, director Ray Kamikawa?

It is an odd sort of success story.

Gone are the days of previous tax directors slapping their foreheads in frustration, and crying that, if only they could get after scofflaws, all sorts of derelicts would be paying up.

Kamikawa, a former private tax attorney, appears on his way to doing more than just pounding his head in frustration.

He's knocking heads for real.

Kamikawa reports collecting $4.1 million more in delinquent taxes this fiscal year as compared to the same period last year.

But, as enforcement is stepped up and the state's economy continues to lag, Kamikawa is finding that more money is owed to state government.

The delinquent tax balance has grown by 25 percent, from $120 million to $150 million.

"This is a result of several factors: economic conditions, more people voluntarily coming forward to file delinquent returns, nonfiler projects and more assessments by our auditors," he explained.

The Kamikawa plan appears to be to cajole, to warn and to scare people into keeping on top of their tax obligations.

"Our collectors are finding that it is becoming increasingly difficult for businesses to find the money to pay their delinquent taxes, so it is even more important for us to encourage people to stay current," he explained.

He is also keeping a list and checking it twice.

Licensed contractors who haven't paid up will go on the list. If they haven't cleared their general excise taxes or gotten approved payment plans, they will not be able to renew their contractors' licenses.

Another list matches those who said they had a profit or loss from their businesses with those who haven't filed general excise tax forms reporting business income.

That last list has resulted in $10 million in new assessments and nearly $1.2 million in cash collections.

Some good news - and a smug chorus of "We knew that" - from the Hawaii Government Employees Association is that few tax cheaters are working for state government.

Kamikawa reports that a check on what state employees were paid and what they claimed as net income showed "no evidence of significant noncompliance.

After the tax department fingers someone, it hires bounty hunters to go after them. A Maui company was picked to hunt down 2,000 small-delinquent accounts. The state is due about $2 million from them, and the collection firm would get $500,000 of that if it recovers the entire two mil.

STILL, Kamikawa sounds a bit like a social worker, saying he's just trying to return folks to the fold.

"Our main objective is to get people back into the system and to pay their taxes currently," he says.

This is one social worker, however, who definitely believes in the Tough Love approach to problems. And so far, he's getting results.


Richard Borreca reports on Hawaii's politics on Wednesday. Write him at the Honolulu Star-Bulletin, P.O. Box 3080, Honolulu, 96802 or send e-mail to rborreca@pixi.com.



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