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Mayor Kim’s Testimony Re: Special Session 2017 – Rail Tax Surcharge

August 11, 2017
Special Session 2017 – Rail Tax Surcharge

Dear Senator Lorraine Inouye, Senator Clarence Nishihara, Senator Donovan Dela Cruz, Representative Henry Aquino, Representative Sylvia Luke, and Committee Members:

We understand that the upcoming Special Session will be considering many different proposals on how to help the City and County of Honolulu Address the funding of their rail system. While we understand that this is not an easy decision, we want to ensure that the legislatures makes their decision based on fairness. We understand that some of the options being considered include increasing GET and TAT for the entire state with all the proceeds going to rail.

These increased taxes would be collected on all islands, even though the rail system is only located on Oahu. That does not seem fair to tax those that don’t even have access to the rail system. We do support the extension of the GET surcharge for Oahu. That seems to be the fairest method to ensure that those most likely to benefit from the system will pay for the system.

In addition, the TAT cap for the counties was not restored to $103 million as in previous years. This reduced our TAT revenue by $1.86 million. This is more than the entire budget for our Civil Defense department. Without these funds, a significant increase in real property taxes for our citizens was necessary. The same citizens that you also represent. We cannot burden our citizens any more for something that will not benefit them.

Taxing all for the benefit of one is not fair. All islands could see an increase in the TAT and GET but only one will benefit. We all will be seeing less TAT in our budgets. We respectfully request that you whatever you can to provide the counties with their fair share of TAT and find another way to fund the rail system, such as continuing the additional GET for Oahu.

We appreciate your consideration as we all attempt to best serve our joint constituents, the people of Hawai’i.

Respectfully,

Harry Kim
Mayor

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