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Sunday, May 22, 2011
DoTax still has no explanation for sudden discovery of $134M
By Andrew Walden @ 6:42 PM :: 9141 Views :: Taxes

by Andrew Walden

After using an alleged “crisis” and so-called “budget shortfalls” to push tax increases through the Legislature, it certainly seemed like fortuitous timing when Neil Abercrombie’s Department of Taxation found a $134M jump in tax revenues shortly after the Legislature adjourned.

The brief announcement came May 11 from the Governor’s office: 

The Hawai‘i Department of Taxation today released its preliminary statement of state general fund tax revenues for April 2011 totaling $490,075,000. This is an increase of $134,068,000 over the March 2011 general fund revenue report. Governor Neil Abercrombie released the following statement:

“The April 2011 revenue numbers are promising and are, in part, a result of better business accounting procedures instituted by the Tax Department. Under the leadership of Director Fred Pablo, the Tax Department has been identifying improvements and changing old policies and practices to get government working again.”

Naturally we at Hawai`i Free Press put a few questions to Pablo:

  • What are the “better business accounting procedures” which contributed to this sharp increase in tax collections?
  • When were these new procedures implemented?
  • Do these policies give a one-time boost on collections or are they likely to result in higher tax collections on an ongoing basis?
  • Is there anything else you would like to tell my readers about how Tax Department procedures affect the month-to-month general fund tax revenues?

Certainly Mr Pablo would be proud of the improvements in “business accounting procedures” which helped the General Fund to rake in an additional $134M?  If this amount were to come in every month for a year, the total would be $1.6B which would more than cover the budget shortfall-without any increase in taxes.  With that kind of money coming in, the HGEA, HSTA, and UPW could all expect fat raises and so would the Legislature.  If anything was left over, they might even begin to improve services.

But no.  DoTax has not provided answers to these simple and obvious questions for over a week now.  The only response came from Public Information Officer Mallory Fujitani who May 17 asked: “Are you still interesting (sic) in a response from the Department?”

Yes we are.  And here’s another question:

  • How would you respond to cynics who say that it is “convenient” to suddenly find so much money after the legislature has adjourned?

---30---

Related: Now that legislature is adjourned, Abercrombie finds $134M, credits “better accounting”

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