If passed, HB1919 would amend the Hawaii Revised Statutes to exempt food and food ingredients, medical services, and feminine hygiene products from the general excise tax. This change is expected to result in significant savings for families; for instance, it is estimated that a two-person household could save over $400 annually on groceries alone. The exemption for medical services aims to reduce the high costs associated with health care in Hawaii, which is one of the few states that still tax such services. By alleviating this tax burden, the bill supports both public health and economic stability in the community.
Summary
House Bill 1919 addresses the general excise tax exemptions in Hawaii, proposing to alleviate the financial burden on households by exempting certain essentials including food, medical services, and feminine hygiene products from the tax. The bill recognizes that Hawaii has the highest cost of living in the U.S., and the general excise tax is disproportionately affecting low- and middle-income families, as it is levied on nearly all economic activities, ultimately raising the cost of goods and services. By removing these taxes, the legislature aims to improve affordability of essential items, particularly for struggling households.
Contention
There are potential points of contention regarding the financial implications of HB1919. Some may argue that exempting these items could result in a loss of revenue for the state, which relies on general excise taxes to fund various services and infrastructure. Additionally, debates may arise over whether the exemptions would equally benefit all demographic groups and if they sufficiently address broader economic issues. Proponents of the bill emphasize its necessity for improving the quality of life for residents facing high living costs, while opponents may raise concerns about the sustainability of the state's budget in light of these tax breaks.