It Doesn’t Always Pay to Make More

by Dr Kelii Akina, PhD, Grassroot Institute

There's a reason that no politician has ever campaigned on a slogan of "Soak the Middle Class." Not only is it a vote-killer, but it's not great for the economy. And yet, that's exactly what we do in Hawaii.

Once again, the Aloha State has made it to the top of another regrettable list. This time, it's about how much the state takes out of your paycheck. According to a recent survey, Hawaii takes more from its citizens' paychecks than any other state. A Hawaii worker with an annual salary of $50,000 sees $542.24 withheld every year. For those who make $100,000 per year, Hawaii takes $1324.69 -- the third highest total nationwide.

And if that weren't bad enough, let's not forget the higher cost of living in Hawaii. So our citizens are not only giving up more to the government, but they're starting with less to begin with (in terms of buying power).

Think about what that really means for our state's future. Not only does it help explain the brain drain that sees some of our best talent departing for the mainland (and better paychecks), but it also reflects a distressing tendency of our state government: to approach every problem with a tax increase as the solution.

In just this legislative session, we've seen attempts to make the surcharge a permanent part of life -- and transportation funding. We've seen proposed income tax increases. There's even an attempt to write a tax for education into the state Constitution.

In other words, it doesn't look like this ranking is going to slip anytime soon.

There's a real lesson here for our state policymakers, if they choose to hear it. Tax proposals and government programs can sound great in speeches. But for the typical Hawaii family, reality is determined by the amount they see on their paychecks. If the state continues to treat our wallets as an inexhaustible resource, they will sap what remains of our economic initiative. Hopefully, the voters will say, "Stop," before that happens.

E hana kakou (Let's work together!),

Keli'i Akina, Ph.D.

President/CEO

Related: Earn $50K? Hawaii Takes More From Your Paycheck Than Any Other State