From House Minority Blog  Feb 28, 2011

Despite Hawaii’s struggling economy, the Majority Party in the State Legislature is considering bills that would hurt small businesses that create jobs in our State.

Today the House Finance Committee heard bills that would tell a business how much it can pay its executives, prohibit a deduction of business travel expenses, impose fees on repeat visitor accommodations, tax creative entrepreneurs who write music or movies, tax their death benefits when a key employee dies; and reverse the state’s long standing position of encouraging investment in high technology firms.

“These bills (HB798, HB806, HB805, HB809, HB976, and HB1092) violate the basic goals of the House Republican Caucus, most notably creating an economic environment to help local businesses thrive, create jobs, and attract international investments,” said Representative Gene Ward, House Republican Leader.

“At a time when our residents need jobs and businesses are just beginning to crawl out of the economic hole of the past two years, to impose punitive new taxes and fees on the job creators of our state is short sighted and wrong,” Ward noted. “Traveling to the mainland is a dire necessity for Hawaii’s small businesses. For the State to declare out-of-state travel is not a legitimate deductible business expense is deplorable. I understand the State is strapped for cash, but we should not slow down the economic engine that generates tax revenues by putting more obstacles in the way.”

The proposals would inject the state into the operations of local companies at an unprecedented level, including telling a firm the maximum amount of pay they can give an employee, despite the work they perform. Several proposals would also attempt to tax non-existent transactions, such as imposing a transient accommodation tax when someone allows a person to use their rental unit or a hotel room at no charge. Additionally, HB 805 would reverse the State’s long-standing policy of supporting high technology companies by repealing the income tax exemption for income derived from stock options issued by qualified high technology businesses.

“I am troubled that the State is attempting to interject itself into the micro-management of individual businesses and will discourage creative entrepreneurs, musicians, songwriters, film makers, and high tech engineers and scientists who enrich our culture and improve our lives,” Ward stated.

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