Oil Barrel Tax - from 5 cents to $1.05

[mdd7000]

House Bill 2421, aka the barrel tax bill, will raise the state tax on a barrel of oil brought into Hawaii to $1.05 from 5 cents.

It is being supported by all of the Democratic representatives.

This bill will have a cumulative effect. Electricity will go up as well as anything that is shipped inter-island. Because companies will have to raise prices to cover their increased costs on oil/fuel usage, they will also be charging more to make up for the increase in the GET that will result from the higher prices!

This is yet another tax upon a tax. Our state must cut spending instead of raising taxes if they want to get out of the current fiscal mess they put themselves in.

[JerryCarr]

This is a sneaky "back-door" tax that the legislators think will go unnoticed, and they may be right. These people don't have the courage to balance the budget by demanding more efficient government or really challenging the public employees unions. They considered raising the GET (another bad idea,) but backed off because that would have been obvious even to the most ignorant voters.

[mdd7000]

Here is Faye P. Hanohano, District 4's (Puna, Pahoa, Hawaiian Acres, Kalapana) representative, contact information.

phone 808-586-6530; fax 808-586-6531
From the Big Island, toll free 974-4000 + 66530
E-mail rephanohano@Capitol.hawaii.gov

Here is Robert N. Herkes, District 5's (Puna, Ka'u, South Kona, North Kona)representative, contact information.

phone 808-586-8400; fax 808-586-8404
From the Big Island, toll free 974-4000 + 68400
E-mail repherkes@Capitol.hawaii.gov

Here is Clift Tsuji, District 3's (South Hilo, Panaewa, Puna, Keaau, Kurtistown) representative, contact information.

phone 808-586-8480; fax 808-586-8484
From the Big Island, toll free 974-4000 + 68480
E-mail reptsuji@Capitol.hawaii.gov

Call or email them, if you care about this additional tax upon a tax.

[Bob Orts]

Questions:
1. Does the tax apply to oil sales to power producers?
2. Does the additional reveuenue being raised get deposited into special restricted funds to be used for the advancement, promotion, and financial assistance of alternative and local energy production?
3. Is there and exemption from this tax on interisland transportation?

[mdd7000]

The exemption seems to be for airline fuel.
The amount for alternative energy is rather small - much less so than what was earlier proposed.

http://www.starbulletin.com/news/2010041...n_oil.html

[Bob Orts]

Putting aside the side speeches on partisan politics and claims of bowing to unions etc, and putting aside misinformation as to how it will impact electric rates or inter-island transportation, people need to READ the BILL and understand exactly what it's for and how it will play out if approved. All the other stuff means nothing.

1. The entire rational for the Bill is based on a need to make Hawaii's more self sufficient in terms of energy, economic development, food, and environment.
2. Special funds will be established that restrict the use of the income to those purposes only.
3. There is ABSOLUTELY No statement in this Bill that has ANYTHING to do with balancing the budget or funding the general fund. Nothing, Nada, ZIP in the Bill that funds from this increase will go towards balancing the State's budget! I defy anyone to show me anything in the BILL that specifically talks about balancing the current budget with this BILL! There is NOTHING written in the Bill about that!

Now, I want everyone to read this carefully! MDD7000 and JerryCarr are not wrong about the Bill. Over 60% of the increased revenue will not go for the stated purpose and will be sent to the General Fund to help balance the budget. OVER 60%!

If the rationale as mentioned in #1 above is laid out in such lengths in the Bill, why is less than 40% of the funds going for that purpose? Why not simply call it a Balancing the Budget Bill with some funding for the other purpose? No they went to major effort to make all these wild claims of self sufficiency, yet the minority of funding will not go for that purpose. RED FLAG #1

Now as I examined #2 above, although the under 40% of funds collected for the stated purpose will be deposited into restricted funds for those purposes only, if you read carefully, you will see that if the legislature does not spend that money under those funds, the money (after a set time period) will be turned over to the general fund for any purpose. There is no mandate that those moneys being collected for the stated purposes and being deposited in so called restricted funds will ever be used for the intended purpose. It's a back-door, funding of the general fund via unspent restricted funds.
RED FLAG #2

Number 3 above is why each person needs to oppose this Bill. This is the lowest form of taxation through cowardly acts. Not only did they spend so much time to write some declaration of the self sufficiency needs of Hawaii, and not only did they allocate only a small segment of collected funds to that purpose, but they didn't even have the decency to mention any funding from the Bill would go to balance the budget. Had they stated right from the beginning that the BILL is also about increase taxes with some going towards the other purposes; you would understand you need to look at it. RED FLAG#3

Nowhere in the Bill has anyone even hinted that this tax increase will fund anything but the stated purposes. The only way you’ll know is by adding up the percentages for each funds and understanding that the excess will go to the general fund. The Bill is a fraud on the people of Hawaii and if you do nothing to stop this, you are agreeing to be the ATM for government.

[Loren Baker]

Bob, thanks for the info. I will look at this further, beyond what the media tells me.