Neighbor island mayors said they are in favor of gaining new taxing powers, but not at the expense of losing much-needed revenue from the transient accommodations tax or hotel room tax. Isle mayors see
strings with taxesThey want taxing powers,
but not at the expense of
giving up hotel room tax fundsBy Crystal Kua
ckua@starbulletin.com"The main thing is that we don't want to lose what we already have as far as revenues," Kauai Mayor Bryan Baptiste said.
The Senate is proposing allowing Honolulu to charge a 1 percent sales tax in lieu of receiving $31 million in hotel room tax revenue.
It is possible the Senate will propose that the neighbor island counties also get the authority to charge a sales tax, a key state senator said.
The concept of allowing the city to impose a general excise tax or sales tax was floated earlier this year by Honolulu Mayor Jeremy Harris.
"It's part of the plan that Mayor Harris has announced for the counties to have some taxing autonomy and basically have some home rule in how to tax our residents and visitors, too," Honolulu Managing Director Ben Lee said.
"We think that by having a general excise tax or a sales tax ability, we would be able to handle our budget much, much better."
Maui Mayor Alan Arakawa said he would not be in favor of getting the additional taxing authority "if the state intends to take all that TAT money and expend it themselves."
Big Island Mayor Harry Kim said he would not support legislation that would result in the counties getting a small amount of the hotel room tax.
"I want the taxing power, and I think that would be nice to give county governments an additional source of revenue if they want to do that," Kim said. "But I would not support the element of taking revenues from the TAT to give to the state."
All the mayors said property taxes support county operations.
Having the authority to levy a sales or excise tax would be more equitable and give them more flexibility, they said.
"You don't want to gain flexibility at the cost of losing funding that you so desperately need," Baptiste said.
The Associated Press contributed to this story.