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Gov. Josh Green Gives Final Approval To Income Tax Break He Hopes Will Make Hawaii Affordable

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Gov. Josh Green Gives Final Approval To Income Tax Break He Hopes Will Make Hawaii Affordable


But others worry the tax cut, which will cost the state billions of dollars, will mean deep cuts to needed state programs.

Gov. Josh Green signed the largest income tax cut in state history into law on Monday, giving final approval to a measure that should deliver bigger paychecks for many of Hawaii’s working people as early as the beginning of next year.

Green told a gathering of lawmakers, media and others at the State Capitol that the tax cut is a crucial part of his administration’s plans to make Hawaii more affordable, and help staunch the flow of people who are leaving the islands.

The administration predicts the new law will reduce state income taxes for 70% of working-class families, and eliminate the state income tax entirely for about 40% of all state taxpayers by 2031.

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“These were the changes that we had to have because we’ve seen an exodus of people who are living paycheck to paycheck,” Green said. “We’ve seen an exodus of those individuals going to the mainland, working families, because they just can’t afford rent.”

In a packed 5th floor Ceremonial Office in the Hawaii State Capital building, Governor Josh Green M.D., surrounded by State House Representatives and Senators along with members of the medical profession, signed two bills into law on Monday that aim to reduce State Income Tax and GET taxes on Medicare, Medicaid and Tricare services beginning in 2026 signaling the biggest tax cuts in Hawaii history. (David Croxford/Civil Beat/2024)
Gov. Josh Green signs the largest state income tax cut in Hawaii history in a packed fifth-floor Ceremonial Office in the Hawaii State Capitol. The new tax law is expected to reduce the income tax burden for a median-income Hawaii family by a total of nearly $20,000 over the next seven years. (David Croxford/Civil Beat/2024)

House Finance Committee Chairman Kyle Yamashita said House Bill 2404 — which is now Act 46 — will reduce the tax burden for a median-income Hawaii family by nearly $20,000 over the next seven years. It will also reduce state income tax collections by a total of $5.6 billion by 2031, according to Green.

State Tax Director Gary Suganuma said his department will modify the tax withholding tables used to calculate how much money is taken out of each paycheck for taxes, and employees should begin receiving more take-home pay in each paycheck in January.

The state Tax Department is offering a downloadable “take-home pay calculator” that residents can use to estimate the impact of the new tax law on their own paychecks.

HB 2404 would increase the standard deductions for taxpayers from the current $4,400 for joint filers to $8,800 for tax filers next year, and then increase that standard deduction in a series of steps until it reaches $24,000 in 2031.

It would grant similarly large expansions in the standard deductions for single filers, heads of households and married couples filing separately.

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It would also eliminate state income taxes for the lowest-paid filers, and adjust the all state income tax brackets to account for inflation.

The governor also signed a more modest tax measure Monday that will eliminate the state excise tax on medical and dental services for people who receive benefits under Medicaid, Medicare or the TRICARE program for the military, retirees and their dependents.

That measure is Act 47, and will reduce state tax collections by $77.5 million in fiscal year 2027, which will be the first full fiscal year after the tax break takes effect. The Tax Department expects it will reduce tax collections by $81 million the following year.

Green predicted that tax break “will bring more providers to our people, it’s super important.”

The huge income tax cut in particular has some observers concerned that the state will resort to deep budget cuts later to balance the state budget, or will forgo important projects the state urgently needs to undertake.

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Nicole Woo, director of research and economic policy for the nonprofit Hawaii Children’s Action Network Speaks, said that given the large loss in revenues from the income tax cut, “we worry how lawmakers will fill that gap.”

The tax cut will reduce state collections by more than $1.4 billion in fiscal year 2032, according to the Tax Department, and the reduced collections will continue indefinitely into the future.

“We worry that needed services are going to face cuts, and needed improvements are not going to get funded in the future,” she said. “We look forward to talking with our lawmakers about how they are going to fill this budget hole without reducing social services, public education and all these other needed things in our community.”

In a packed 5th floor Ceremonial Office in the Hawaii State Capital building, Governor Josh Green M.D., surrounded by State House Representatives and Senators along with members of the medical profession, signed two bills into law on Monday that aim to reduce State Income Tax and GET taxes on Medicare, Medicaid and Tricare services beginning in 2026 signaling the biggest tax cuts in Hawaii history. (David Croxford/Civil Beat/2024)In a packed 5th floor Ceremonial Office in the Hawaii State Capital building, Governor Josh Green M.D., surrounded by State House Representatives and Senators along with members of the medical profession, signed two bills into law on Monday that aim to reduce State Income Tax and GET taxes on Medicare, Medicaid and Tricare services beginning in 2026 signaling the biggest tax cuts in Hawaii history. (David Croxford/Civil Beat/2024)
House Finance Committee Chairman Kyle Yamashita said Monday was a “monumental, historic day” with the signing of House Bill 2404. Green said the measure will reduce state income tax collections by a total of $5.6 billion by 2031, and will stimulate the state economy. (David Croxford/Civil Beat/2024)

The new law also provides large tax cuts to the wealthiest Hawaii residents “who really don’t need it,” Woo said.

But Green declared that “we won’t be cutting services,” in part because he predicts the tax cut will grow the state economy. A larger economy would translate into increases in other kinds of tax collections, such as the general excise tax.

“Individuals who are working paycheck to paycheck will spend every single dollar on local businesses, on their rent, on cars, on their health care needs. They will spend it here for their families, for school books for their children, they will all spend it right here at home,” he said.

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Green also said he expects that reducing income taxes will mean residents will have more money and can rely less on Medicaid and other expensive social programs.

“As we support people’s quality of life and their ability to pay and survive on their own, a lot of those other programs will see cost savings, so we’re being smart about this,” he said.

However, Green also said his administration has begun a “deep dive into the costs that we have on the books that maybe shouldn’t be on the books.” Specifically, he said about 30% of state jobs are vacant, and unspent salaries often result in year-end surpluses of several hundred million dollars.

For positions that haven’t been filled for three or four years, Green said he wants to either raise the pay for essential state jobs to finally attract workers to fill them, or “make sure that we cut out some of the excess costs.”

“We expect to present a budget to the Legislature next year with fewer positions overall so that we get rid of some of what has been perceived as waste,” he said.

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He also noted the administration has been pushing to “get more resources in many cases from travelers.”

Green campaigned on a plan to impose a new “green fee” on arriving tourists to help cope with climate change and the impacts from the millions of tourists who come here each year, but the idea has stalled at the Legislature in each of the last three sessions.



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Hawaiian announces $600 million airport, wide-body upgrades | Honolulu Star-Advertiser

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Hawaiian announces 0 million airport, wide-body upgrades | Honolulu Star-Advertiser


COURTESY HAWAIIAN AIRLINES

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Hawaiian Airlines today announced an investment of more than $600 million over five years to improve airport passenger areas across the state and interior upgrades to widebody aircraft.

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Hawaiian Airlines CEO Diana Birkett Rakow told the Honolulu Star-Advertiser ahead of today’s announcement at Daniel K. Inouye International Airport that other improvements will include better apps, a better website that will make it easier for passengers to change flights, among other things that also include better integration with Alaska Airlines, which acquired Hawaiian in 2024, making it a subsidiary of Alaska Air Group.

“We have pushed a lot of change through the system for the last couple of months,” Rakow said. “We’re working on integrating our ticketing systems because right now we’re on two separate ticketing systems that don’t talk to each other.”

After late April, she said, booking on the shared Alaska Air and Hawaiian Air ticketing system “will be much more seamless.”

In announcing the renovations and changes, Hawaiian pledged “a significantly smoother guest experience … once Hawaiian Airlines and Alaska Airlines share the same passenger service system and Hawaiian Airlines joins the oneworld alliance, both scheduled for late April.”

Right now, Rakow acknowledged, “unfortunately there is some friction.”

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“There’s been so many changes and all of that friction is really painful,” she said. “We are committed to making sure we are addressing the issues. … We are certainly not perfect, but we are committed to working together. … Really, after April, it is going to improve significantly.”

Each island airport also will see renovated lobbies and gates designed to increase comfort, provide better seating and amenities such as improved power charging.

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Daniel K. Inouye International also will get a new 10,600-square-foot lounge at the entrance of the Mauka Concourse in Terminal 1.

And starting in 2028, Hawaiian’s wide-body Airbus A330s will get new seats, carpets, lighting, business class suites, a Bluetooth-enabled in-flight entertainment system with high-definition screens and free Starlink Wi-Fi.

Gov. Josh Green said in a statement ahead of today’s announcement that, “Hawaiian Airlines’ investment is exactly the kind of long-term commitment Hawaiʻi needs. Modern, welcoming airports improve the experience for residents and visitors alike, strengthen our economy and keep Hawaiʻi competitive as a global destination. We appreciate Hawaiian Airlines’ partnership in advancing workforce development, regenerative tourism, clean energy, and community programs that reflect the values of our islands.”

The New Year began with a .75% increase in Hawaii’s Transient Accommodations Tax that will help the state fight climate change.

Rakow said that Hawaiian is working to better inform inbound passengers about how to respect Hawaii’s culture and environment.

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Hawaiian said it will continue to support “programs promoting regenerative tourism, culture and conservation.”

The airline also said it will fund grants to nonprofit organizations “promoting cultural programs, environmental preservation, and perpetuation of native Hawaiian art and language through the Alaska Airlines | Hawaiian Airlines Foundation.”




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Climate security threats to Hawaii outlined in report | Honolulu Star-Advertiser

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Climate security threats to Hawaii outlined in report | Honolulu Star-Advertiser




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Flood advisory in effect for Oahu, Maui and Hawaii island | Honolulu Star-Advertiser

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Flood advisory in effect for Oahu, Maui and Hawaii island | Honolulu Star-Advertiser


UPDATE: 11:13 a.m.

A flood advisory is in effect for Oahu until 2:15 p.m. today due to flooding caused by excessive rainfall.

At 11:09 a.m., the radar showed heavy rain developing and traveling slowly eastward over Oahu.

“The heaviest rain is currently over the western half of the island, but is expected to fill in and move over the remainder of the island over the next few hours. Rain was falling at a rate of 0.5 to 2 inches per hour,” forecasters said.

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Some locations that will experience flooding include Honolulu, Waipio, Mililani, Pearl City, Waikele, Wahiawa, Wheeler Field, Waipahu, Aiea, Kunia, Halawa, Waiahole, Waikane, Schofield Barracks, Salt Lake, Kahaluu, Moanalua, Ahuimanu, Iroquois Point and Ewa Beach.

Meanwhile, the flood advisories have been extended for Hawaii County and 1:45 p.m. and Maui County until 2:30 p.m.

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At 10:30 a.m., the radar showed heavy rain moving over portions of the Puna and Kau coasts. Rain was falling at a rate of 1 to 2 inches per hour, with the heaviest rates of up to 3 inches per hour between Hawai‘i Volcanoes National Park and Pahoa, including portions of Pahoa Kalapana Road and Highway 11.

Some locations that will experience flooding include Hilo, Hawaii Volcanoes National Park, Volcano, Glenwood,

Mountain View, Wood Valley, Hawaiian Acres, Pahala, Orchidlands Estates, Keaau, Pahoa, Punaluu Beach, Kawa Flats, Papaikou, Naalehu, and Fern Forest.

At 11:04 a.m., the radar showed heavy rain over portions of eastern Maui. Rain was falling at a rate of 1 to 2 inches per hour with the highest rainfall rates in the upslope areas between Kaupo and Nahiku.

“While no significant impacts have been noted as of yet, additional rainfall over that area today is expected to produce more flooding concerns,” forecasters said.

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The flood watch remains for all Hawaiian Islands.

EARLIER COVERAGE

A flood watch is in effect for all Hawaiian Islands today through Monday afternoon due to the possibility of flash flooding caused by excessive rainfall, according to the National Weather Service.

A deepening Kona low north of Kauai is expected to move southwest today and Monday before turning west. Thunderstorms and heavy showers will affect the region over the next couple days leading to the flash flood threat. Winds may strengthen to wind advisory levels Monday for lower elevations and high wind warnings on Hawaii island summits. Lingering moisture may keep rain over the state through the week.

>> Prepare for rainy weather as Kona low hits Hawaii

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“Flood prone roads and other low lying areas may be closed due to elevated runoff and overflowing streams,” according to the forecast. “Urban areas may receive more significant flooding and property damage due to rapid runoff. Significant flooding may occur due to the overflow of streams and drainages. Landslides may also occur in areas with steep terrain.”

The greatest flood risk is along the southeastern mountain slopes of Maui and Hawaii counties as deep moisture spreads up the slopes.

The flood watch may be extended into Tuesday if weather conditions persist.

Flood advisories are also in effect for Hawaii County until 10:45 a.m. today, while Maui County will remain in effect until 11:30 a.m. today.

At 7:45 a.m. today, the Hawaii island radar indicated heavy rain traveling over portions of Puna and Kau coasts. Rain was falling at a rate of 1 to 2 inches per hour, with isolated heavier rainfall rates of 3 inches per hour between Pahala and Pahoa including areas of Pahoa Kalapana Road and Highway 11.

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Some locations that will experience flooding include Hilo, Hawaii Volcanoes National Park, Volcano, Glenwood, Mountain View, Wood Valley, Hawaiian Acres, Pahala, Orchidlands Estates, Keaau, Pahoa, Punaluu Beach, Kawa Flats, Papaikou, Naalehu, and Fern Forest.

At 8:19 a.m. today, the Maui County radar showed heavy rain continuing to develop and move over the eastern portions of the island. Rain was falling at a rate of 1 to 2 inches per hour with the highest rates and totals found in the upslope areas between Kaupo and Nahiku.

Some locations that will experience flooding include Kipahulu, Kaupo, Hana, Haleakala National Park and Hamoa.



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