As 2006 comes to a close, let me remind you that there are only 61 days in which to do business in Hawaii at the present General Excise Tax rate of 4.16%. On January 1, 2007 the Hawaii State General Excise Tax will increase to 4.5 and up to 4.712%. The massive tax increase is a result of HB 1309 passing out of the State Legislature in 2005 that allowed the counties to levy a tax increase on top of the General Excise tax to fund transit projects.
Governor Linda Lingle allowed the bill to become law on July 11, 2005 without her signature, on the promise that the Counties would administer the collection of the additional tax. That did not happen.
Instead the Hawaii State Department of Taxation was given the additional task to collect the tax, only to pass it on to the county that the tax will "benefit," namely the City & County of Honolulu.
The real tax burden of course will lie with all of the firms and individuals doing business in the City & County of Honolulu as well as those neighbor island businesses that engage in transactions with firms on Oahu. This pretty much means just about everyone. In the end, consumers are the ones who will be hit the most in the pocket with the tax increase. Neighbor islanders will pay and not get a penny of benefit from money that is taken away to fund Mayor Mufi Hannemann's train.
The Mufi train is another step closer to realization as Mayor Hannemann announced his preference for rail as the only alternative to Oahu's traffic problem. The estimated cost according to his administration lies somewhere between $3.6 and $4.6 billion. Read that folks... BILLION!
I often think of Mayor's Hannemann campaign statement: “Do we need it? Can we afford it? Can we maintain it?” The answer to all 3 questions in regards to rail is a resounding NO!
There are many reasons why a rail system should not be built for Honolulu. You can read more about this at the HonoluluTraffic.com website.
The Hawaii State Department of Taxation website has everything you need to know on the tax increase. You can read about it at this link: General Excise Tax Surcharge (a fancy name for the new tax).
If you want to lash out at the politicians who voted for the tax increase, consider voting against the following legislators who all voted YES on HB 1309 which became law as Act 247.
State Senate: Baker, Bunda, Chun-Oakland, English, Espero, Fukunaga, Hanabusa, Hee, Hooser, Ige, Ihara, Inouye, Kanno, Kim, Kokobun, Menor, Nishihara, Sakamoto, Taniguchi
State House: Abinsay, Arakaki, Cabanilla, Caldwell, Chang, Ching, Evans, Hale, Herkes, Ito, Kahikina, Kanoho, Karamatsu, Kawakami, Lee, Magaoay, Morita, Nakasone, Oshiro B., Oshiro M., Say, Schatz, Shimbukuro, Sonson, Souki, Takai, Takamine, Takumi, Tsuji, Yamane, Yamashita
Legislators whose names are listed in red are up for re-election. Some were unopposed and elected in the primary election. Kanno retired from the Senate. House members listed in black retired or ran for another office.
Think about those legislators and your wallets when you vote this year. Do they deserve to be in office again after raising your taxes and cost of living?
Finally if you are planning to buy a big ticket item such as real estate, a new vehicle, computer, HDTV or anything else, do it before January 1. After that you pay more. This is also a good time to stock up on staples such as non-perishable food and drink, toilet paper, rice, paper towels, office supplies and much more. Everything purchased on or from the island of Oahu including rentals will all be subject to the higher tax.

