In WHT this morning we actually had a small business owner ASKING our Legislators to sign a Bill (SB-2226) that will slap a tax on Internet purchases! This business person isn’t happy that we can go to the internet and POSSIBLY save a few dollars on items that we OFTEN can NOT find in Hawaii – Especially on the Big Island!
Every time we turn around someone is talking about raising Taxes on something. If it isn’t our President it’s our local legislators! When are people going to awaken to the fact that we are being taxed to death and nobody is trying to cut costs and STOP the rise in costs of everything we eat, do or touch! Feel free to read “Joys” letter:
Below are the facts that anyone can find just by checking Google:
Hawaii does not have a sales tax per se, but it does have a gross receipts tax (called the General Excise Tax) and a Use Tax which apply to nearly every conceivable type of transaction (including services), and is technically charged to the business rather than the consumer. Hawaii law allows business to pass on the tax to the consumer in similar fashion to a sales tax.
Unlike other states, rent, medical services and perishable foods are subject to the excise tax. Also, unlike other states, businesses may or may not show the tax separately on the receipt, as it is technically part of the selling price. 4.0% is charged at retail with an additional 0.5% surcharge in the City and County of Honolulu (for a total of 4.5% on Oahu sales), and 0.5% is charged on wholesale. However, the state also allows “tax on tax” to be charged, which effectively means a customer can be billed as much as 4.166% (4.712% on Oahu). The exact dollar or percentage amount to be added must be quoted to customers within or along with the price. The 0.5% surcharge on Oahu was implemented to fund the new rail transport system. As with sales tax in other states, nonprofit organizations may apply for an exemption from the tax.
Hawaii also imposes a “Use tax” on businesses that provide services that are “LANDED” In Hawaii. One example is: As a property owner in Hawaii you contract with a mainland architect to design your Hawaii home. Even though the architect perhaps does all of their work in a mainland location the architect needs to pay the State of Hawaii a 4% Use tax on the architect’s fee because the designed house is located in Hawaii. That holds true even if the house is never built. The tax is on the produced product which is the design and provided building plans.
Taking that example a step further. A major retail chain on the US mainland contracts with a mainland architect to design a store in Hawaii. Because the store is located in Hawaii the architect is required to pay the State of Hawaii 4% on the entire fee they charge the retail chain to design the Hawaii store.
Isn’t enough, enough?
Is the END in Sight? JUST SAY NO MORE!!