FOR IMMEDIATE RELEASE
March 7, 2002
Contact: Rep. Marcus Oshiro
DEMOCRAT BILLS TO BOOST ECONOMY, HELP SMALL BUSINESS
ADVANCE DESPITE GOP RESISTANCE
Despite considerable opposition from Republicans, the House today successfully passed a Democratic bill that would keep millions more dollars circulating in the local economy and increase the size of people's paychecks, according to House Majority Leader Marcus Oshiro.
House Bill 1996 would substantially reduce payments for individuals and corporations who pre-pay their income taxes by lowering the payment required from 90 percent to 60 percent, according Rep. Bob Nakasone, author of the measure.
"For example, corporations make payments quarterly at 90 percent of the estimated tax. This bill lowers it to 60 percent, enabling businesses to keep 30 percent more of that cash on hand at all times," he said. "I don't know why so many Republicans voted against the measure, perhaps they just didn't understand the bill."
According to the State Tax Department's Annual Report for 1998-99, corporations paid $78.7 million in estimated income taxes, of which $44.5 million was eventually refunded. " If the rate is lowered from 90 percent to 60 percent, about $23.6 million would have remained in the hands of businesses, circulating through the economy, instead sitting in the State's bank account collecting interest," Nakasone said.
For individuals required to pay estimated income taxes, the threshold would be lowered from the current $125,000 to $50,000 annual income. "The bottom line," Nakasone said, "is that people would see their net take home pay increase. And studies show that when people have the extra cash, they will buy things."
In supporting the measure on the House floor, Rep. Nathan Suzuki, a certified public accountant, said clients who use his tax preparation services "want me to vote for this bill."
A pro-small business measure, aimed at helping small gasoline dealers defend against being overrun by large oil companies also passed the House. HB 2333, HD 1, would reduce the time that a manufacturer or jobber may operate a former dealer-operated station from two years to 90 days, thus closing what some called a loophole in the existing State divorcement law.
"I'm happy to represent small businesses in this case," said Rep. Hermina Morita, chair of the Energy & Environmental Protection Committee.
Rep. Ed Case said he supported the bill because the Hawaii market lacks a true competitive marketplace that can moderate oil and gas prices and that he is "motivated by an extreme distrust of the oil companies" following the settlement of the State's antitrust lawsuit.
"These two bills, when combined with other measures proposed by House Democrats, would bring about economic stimulation and move toward a more competitive market for gasoline prices," Oshiro said. He also took to task those Republicans who voted against the measures. "I can't understand why they would be against putting millions back into the economy and helping small businesses."
Other bills passing third reading in the House today included:
House measures not meeting today's midnight deadline are considered dead. Measures passing third reading will be submitted to the State Senate for consideration while Senate-originated measures passing third reading cross over to the House.