Friday, July 9, 2010

Balancing the budget

Letter to the Editor in today's Star-Advertiser:

Legislators avoided tax increases

Richard Borreca's column makes some important and cogent points ("Lingle fails to give credit where tax-hike credit is due," Star-Advertiser, July 6). Supplementary points, however, are necessary to correct any misperceptions caused by the headline.

First, the Legislature did not solve the general fund budget shortfall solely by raising taxes. During the 2009 and 2010 sessions, the state faced deficits of $2.1 billion and $1.2 billion, respectively. In both sessions, about 50 percent of the shortfall was addressed by budget cuts initiated by either the governor or Legislature.

Second, the Legislature balanced the budget without a general excise tax increase, without an income tax increase on low- and middle-income families, and without scooping the counties' hotel tax share. The Legislature wanted to avoid a substantial, broad-based tax increase that would have hurt the economic recovery and worsened the cost of living. Instead, the Legislature chose the strategy of increasing selected, narrowly focused taxes and fees and revising certain tax breaks.

For information on how the budget was balanced, see the charts at hawaiihouseblog.blogspot.com.

Rep. Calvin Say, Speaker of the House
Rep. Marcus Oshiro, House Finance Chairman
Rep. Blake Oshiro, House Majority Leader

2 comments:

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