Let legislators know how much you appreciate tax cut, Kent says

from Grassroot Institute of Hawaii, July 18, 2024

Grassroot Executive Vice President Joe Kent gave kudos on Sunday morning to Hawaii state legislators who voted unanimously to enact a historic tax cut that will save taxpayers more than $5 billion over the next six years.

But now, he said to Hawaii News Now reporter Annalisa Burgos on the “Sunrise” program, Hawaii taxpayers must ensure that those lawmakers stay the course.

Kent said that for the average Hawaii family the tax cut will total about $350 in tax savings this year, around $1,000 next year, $2,000 the next year, and so on.

“This is a huge dent in Hawaii’s cost of living,” he said.

Kent encouraged taxpayers to communicate with lawmakers about the importance of this tax cut.

“If the lawmakers don’t get a little pat on the back for this,” he said, “then they’re going to say, ‘Well, does anyone care about this?’ And yes, people in Hawaii care about a tax cut.”

TRANSCRIPT

7-14-24 Joe Kent with reporter Annalisa Burgos on Hawaii News Now

Annalisa Burgos: So in the news, we’ve been talking about the new state budget, $10.3 billion, and a lot of it also with a tax reform — $5.6 billion till 2031. Here to tell us more about it and how it impacts you is Joe Kent. He is executive vice president with Grassroot Institute here in Hawaii. So good to have you, Joe.

Joe Kent: Thanks for having me here.

Burgos: So bottom line, what does this mean for our taxpayers?

Kent: This is a huge dent in Hawaii’s cost of living. For the average family, it’s around $350 in tax savings this year. But that goes out to around $1,000 next year, and $2,000 the next year, and so on.

So, this is a tax cut that grows. I can’t remember the last time Hawaii cut taxes, and now we’ve just cut taxes by $5 billion. This is huge, and that’s going to really impact the cost of living.

We’ve seen so many families leaving the state — tens of thousands of families every year leaving the state, moving to the mainland. It’s like 50,000 residents have moved away since 2016. That’s bigger than the Aloha Stadium, moving away because —

Burgos: And affecting our economy.

Kent: That’s right. And so, spending is growing at the state level and our residents are leaving. So that leaves fewer of us left behind. It’s time to cut taxes which is perfectly well-timed.

Burgos: I know it was a little bit controversial because they were worried that it would take money away from critical programs. Your think tank had been lobbying for it.

Kent: Well, the state budget did get a little haircut this year — a little trim of around $74 million. But that’s in the context of a $10 billion budget. So this is less than 1% of the budget.

And really, we want to keep spending low. We shouldn’t be afraid of a haircut because when they cut spending, that allows them to cut your taxes, and that allows you to have more money in your pocket to deal with groceries and other things.

Burgos: Yeah, especially with inflation still pretty high and our housing prices and all that. But you know, there was some criticism that it only would benefit a certain higher income level. Is that true? 

Kent: No, that’s not true. It benefits everyone. This is a tax cut across the board. And the biggest cut is on those lower and middle incomes. Now, the higher incomes — yes, they got a tax cut. But the lower and middle incomes got a huge tax cut as a percentage of their income.

So this is really directed at the middle class, basically. And the ALICE [Asset Limited, Income Constrained, Employed] families — those people who are working, asset limited but employed — they cannot afford to live here. They’re thinking of moving away, and hopefully, this tax cut will help them.

Burgos: That’s a real benefit if a lot of our families decide to stay and make it more affordable. 

So you were telling me that this is over the next six or seven years? But it’s not concrete, then? Things can happen.

Kent: Things can happen. So you have to watch the numbers because next year, if the budget goes through a hiccup, or the following year, they can always take the tax cuts back, and they can take your tax money back.

I think people in Hawaii really need to talk about the importance of this tax cut to them. And I think next year, when tax season rolls around, everyone’s going to notice this really big benefit on their tax form.

Burgos: So, I guess the goal would be every year to have lawmakers continue to budget for this.

Kent: Yeah, if the lawmakers don’t get a little pat on the back for this, then they’re going to say, well, does anyone care about this? And yes, people in Hawaii care about a tax cut, I think. So, I mean, maybe it’s just a foreign language to us since it hasn’t happened in a long time.

Burgos: We’ll have to see once we file our taxes how that really impacts our wallets.

Kent: Oh, you’re going to see.

Burgos: OK, all right. Well, we’ll hold you to that. Where can we find more information in case anyone wants any?

Kent: Go to the Grassroot Institute, so grassrootinstitute.org, and we write all about it. We’ve got a little calculator there where you can calculate how much it’s going to save you.

Burgos: OK, that’s good to know. Thank you so much. Joe Kent with the Grassroot Institute joining us here today. We are off for a break. You’re watching “Sunrise.”