The Legislature seems to be in a kind of a fiscal panic, with the downward revision in projected state revenues that came to light in recent weeks.
That may be putting too positive a spin on this year’s uncommonly heavy load of tax proposals still moving through both state Capitol chambers.
It also could be described as a money grab, pure and simple: lawmakers yielding to a habitual practice. When in doubt about funding, tap the taxpayers again. And it’s an easier maneuver this session for legislators whose elections are behind them.
In any case, the politicians had better rethink the wisdom of pushing more than a dozen new taxes on a weary workforce already reeling from the rising cost of living. Unless they reverse this trend they may be fueling a potential tax revolt.
There are variations on the theme, of course, and some tax proposals have a defense.
Primary among these would be the extension of the general excise tax surcharge financing the Honolulu overbudget rail project.
The current tax will sunset before enough money is raised to complete the project, and the federal overseers have set an impending deadline for a revised financial roadmap. If this project is to be completed, plainly this tax needs to be extended.
There are bills that would level the playing field for businesses, such as the effort to collect the excise tax for purchases made online, just as they are at brick-and-mortar establishments. That seems to be an even-handed way to apply state tax liability.
But those making the decision must recognize that counties also may increase local taxes and fees — including the city’s own efforts to raise rail funds. There’s only so much taxpayers can tolerate — which ought to force a re-evaluation of some other proposals.
For example: The bid by the state teachers union to implement an education tax through a constitutional amendment sets a bad precedent, by treating one group of public workers differently from the rest.
A tax should not be imposed through a constitutional change because that is not the purpose of a governmental organizing document. There’s a high bar for amending the Constitution — too high for something that requires frequent revisiting, such as adjustments to the state revenue streams. That’s the proper job of the Legislature, which meets annually.
Further, the measure would add a surcharge on property tax and on hotel rooms. Tourism, which is the state’s economic engine, depends on the goodwill of Hawaii visitors, and the Aloha State is starting to show something less than aloha to them.
Higher gasoline taxes are the aim of other legislation, with the stated objective of improving the state transportation system. Hawaii transportation officials haven’t put existing federal funds to effective use. Further taxing the population, pouring more money down a clogged pipeline of projects, is unjustifiable.
To be sure, each bill should be evaluated on its own merits, and a few may be needed to provide fiscal support for a new governmental function. For example, a tax on medical marijuana arguably can underwrite the necessary task of regulating this new industry.
Targeted measures for a limited purpose are one thing. But the cumulative weight of new broad-based taxes is too much to bear.
Lawmakers should instead be looking for ways to ease the tax burden on the neediest of Hawaii citizens. The long-sought earned income tax credit, for instance, would incentivize work and put more money in the pockets of those who need it most.
That would require the state to cope with such a revenue cut by curbing its own spending habits — and that strategy is not a go-to in the legislative toolkit.
But if lawmakers want to head off a taxpayer revolt, perhaps it should be.