OUR OPINION


Give taxpayers a piece of the revenue pie

THE ISSUE

Lawmakers are at odds over reductions or changes in state taxes.

WHEN the state Legislature opens for business on Wednesday, front and center will be a revenue surplus that is expected to reach nearly $600 million.

The focus will be on spending requests with education and housing needs at the hub. Though lawmakers say public sentiment leans toward sending available funds in those directions, the load on taxpayers also needs lightening.

Governor Lingle and Senate President Robert Bunda see Hawaii's strong economy as an opportunity to ease the burden on taxpayers, but have different ideas on how to do it. Meanwhile, House Speaker Calvin Say would rather delay tax cuts and any restructuring of tax laws until a review is completed next year.

Lingle has proposed refunding a total of $300 million to taxpayers, which might be welcome in the short term. However, other methods she and Bunda have offered at various times might be better for the long term.

Raising the standard deduction on income taxes, unchanged for more than 20 years, would be an equitable way to let taxpayers keep more of their paychecks as the costs of health care, food, fuel and housing continue to grow. Adjusting income tax brackets also would help to lower the freight.

Raising the level for paying income taxes would benefit low-income workers and families. State leaders also should adopt an earned income tax credit, based on federal guidelines, to assist the working poor.

Hawaii's general excise tax, which places an unyielding encumbrance on residents, likewise needs recalculation. A credit to offset the tax on food, drugs and medical care would not exact a huge hit on revenues but would make things just a bit easier for individuals and families.

Indications are that Hawaii's economy will remain solid, barring global political changes, natural disasters and stresses on the national economy. Still, House Speaker Say would rather be cautious about the state's wealth, a reasonable approach for one who has seen the rises and precipitous falls through the years.

However, schools and aid for affordable housing as well as programs that help the vulnerable have felt the sharp cuts of leaner times. When there is money available, needs should be filled -- not carelessly, but at least to make up for past shortages.

As always, state leaders will be confronted with many seeking a piece of the fat revenue pie. Say rattled off a host of interests, from auto racing to the film industry, that have already put in their bids. Taxpayers, however, should be first in line for a slice.







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