It's the Economy…

House Republicans said today the majority party must stop the expansion of government and give taxes back to the people in order for the economy to begin growing again.

Republicans said the easiest way to return tax money to the public is through the elimination of the GET on food and medical services, which can be done beginning next year by closing down unneeded special funds identified by State Auditor Marion Higa.

"If we eliminate the tax on food and medical services beginning in 2003, we will need approximately $80 million for the second half of the fiscal year," said Galen Fox, House Republican Leader. "Economic stimulus begins with people having more to spend and the best way to give people more to spend is to not take it in the first place."

Republicans said the State Auditor reviewed the special funds that are not needed or not complying with its purpose and recommended their discontinuance. These funds are not part of the funds that have already been identified to balance the state budget.

"We can provide this tax break for every citizen in Hawaii and the state has the resources to do it," said Mark Moses (R-Makakilo, Kapolei). "We have not focused on the economy during this session and that is a big mistake. We have done nothing to help create jobs."

"It is frightening to realize that from 1992 to 2001, state government jobs grew by 11.5%, while jobs in the private sector declined by 1.1%," said Fox. "It is additionally scary that our state operating budget grew by 50% during this time, yet the Hawaii Gross State Product (GSP) grew by less than 22%."

Republicans said the current legislative session is doing little to create jobs, which means the legislature isn’t helping the businesses that hire people. "The best way to help businesses is to give them business--that is, to buy their product or service. People can't buy unless they have money. Eliminating the tax on food and medical services will put money in the hands of people to spend, support local businesses, and create jobs" Fox said.

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