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Can They Find Enough Ways To Raise Taxes?

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By Lowell L. Kalapa

So you thought the state was rolling in dough with all this talk about a $600 million surplus. Well, it sure wouldn’t seem like there is a surplus the way lawmakers are finding ways to raise new revenues in some of the most inane ways.

Take for example the proposal to hike the tax on cigarettes going from the present 7 cents per cigarette to 13 cents over the next three years. Sure anti-tobacco advocates believe that the higher the cost of cigarettes the more likely it will cause smokers to quit or prevent people, or more specifically kids, from taking up the habit. But is the use of the increase in the tax on cigarettes that proves to be amusing about this year’s proposal. 

Under the proposal currently being considered, 50% of the revenues collected in excess of what the current 7 cents per cigarette tax produces would go to fund the Cancer Research Center being built on the shores of Honolulu Harbor. Think about it, we need to have people continue to smoke because lawmakers need to have those funds roll in so that the operations of the Cancer Research Center can be funded. Flip the coin over and what does this action mean? We need to have people continue smoking because we need money to underwrite cancer research. So smoke up everyone!

The other half of the increased receipts would be split between the department of health’s promotion and disease prevention programs and the Hawaii tobacco prevention and control trust fund. The former program already can use money from the tobacco settlement funds to undertake tobacco prevention programs which makes the earmarking of the increase in the cigarette tax a duplication of what is already available for a program which has been criticized as not doing enough with the funds that are already available. 

The latter fund is established to carry out programs to reduce cigarette smoking and tobacco use among youth and adults through education and enforcement activities and controlling and preventing chronic diseases where tobacco is a risk factor. While it would appear logical that the proposal would hit up users of tobacco to fund these prevention programs, what message does that carry when at the same time the intent is to discourage smoking? Smoke up, because we need those tax dollars to fund these prevention programs!

Then there is another program that wants to insure that there are sufficient funds to provide trauma centers around the state and to maintain physicians on-call for trauma care. While such a noble cause, after all we never know when we will need emergency trauma care, it is the funding for such a program that provides the amusement. 

While decrying the high cost of energy, in particular gasoline for our automobiles, this proposal would siphon off receipts from the environmental response fund. This is the fund that was established in the late 1980’s for the purpose of setting aside a chunk of change to fund the clean up of oil spills that might taint our island’s shores. This was partly in reaction to the Exxon Valdez disaster in Alaska where thousands of gallons of crude oil washed ashore.

So reasoning that purveyors of petroleum products should help establish a clean-up fund, the legislature levied a nickel per barrel on all petroleum products imported into the state. At that time lawmakers decided that they should set a limit on how much money could accrue in the fund and put a cap of $7 million on the amount that could be accrued before the levy was halted. Later when clean water programs were added to the responsibilities of the fund, the ceiling was raised to $20 million and a floor was set at $3 million.

Thus, until the $20 million ceiling is reached, there is a nickel imposed on every barrel of petroleum product imported into the state. While it doesn’t sound like much, one has to remember that not only does it include the barrels of crude that are refined into the gasoline we put in our cars, but it also applies to all of the petroleum products that the public utilities import to provide our electrical and gas needs that light our homes and cook our meals.

Thus, if moneys are taken on a continual basis from the environmental response fund to fund the new trauma center fund, the $20 million ceiling will never be reached and consumers throughout the state will continue to pay for the high cost of energy which is exacerbated by the nickel per barrel environmental response tax.

Given the fact that supposedly the state is awash in a cash surplus, one would think that lawmakers would take moneys out of the surplus to fund such noble causes instead of finding ways to keep the tax heat turned up!

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