Tokuda: Tax break for rich OK. No break for poor

Tokuda: Tax break for rich OK. No break for poor

Bart Dame on tax justice:

Nationally, we tend to blame the Republicans for giving so many tax breaks to the corporations. But in Hawaii, the Democrats have controlled the tax structure for over 50 years and low-income people pay about 13% of income in taxes while the very rich pay only about 8%.

The chair of the State Senate Ways and Means committee, a nominal Democrat, just decided to not even hear a bill which would block a tax cut for rich people scheduled to go in effect at midnight, December 31st.

She says there is no money in the budget to increase tax credits for low income people, but gives a $48 million tax cut to those earning over $250,000. She hopes you won’t notice. I hope you do.

HB886 was passed by the house, was making its way through the senate when it came to a screeching halt in Sen Jill Tokuda’s Ways and Means committee.  Sen Tokuda refused to hear it.  Dame explains:

It would have done 3 things:

1) Raise the renter’s tax credit for low income people. This has not been adjusted for inflation since 1981.  Interestingly, the renters tax credit is a pretty effective way to prevent or catch tax cheats who don’t declare their rental income.


2) Raise the Food Tax Credit to (partially) compensate low income Hawaii residents for the general excise tax we pay on food. This has not been adjusted for inflation since 2007.

3) Delay for 5 years a tax cut for those earning over $250,000, scheduled to go into effect, unless the legislature acts, at the end of 2015. HB 886 was the last opportunity for the Lege to stop this tax cut.

Using the excuse, “there is no money,” the only bill WAM has moved forward which gives even a SMALL tax cut for low income residents, is SB555, which would adjust the Food Tax Credit for low income residents.

So there is “no money” for credits for the poor but there is money for tax cuts for the rich?

Who would have thought that a Democrat would support cutting taxes for the rich and letting the poor pay a higher effective tax rate?  Hello?  Isn’t a progressive tax system one of the planks of the Democratic Party Platform?

Leave a Comment