The League of Women Voters of Hawaii supports this proposed amendment to our constitution to change the appointment of the Tax Review Commission to every ten years from the present five years but only with an amendment that tasks it to review annually or biennially at least, the tax bills passed the previous year(s) to see how they comply with the best principles of taxation.
The taxation system should be reviewed periodically to see how well it follows the criteria for a system that is fair, equitable, simple enough for taxpayers to to understand and for easy compliance, adequate for the needs of our government, stable and predictable, etc.
And just as important, the product of the commission should be something that is
studied, and used in making corrections to our taxation system where necessary, and not something that is tolerated to fill a constitutional mandate.
The taxation system is important to all of our lives. We all want to pay as little as possible but enough that government programs that are necessary to the health and well-being of our communities, to achieve those things which we as individuals cannot do by ourselves can be provided. Certain tax credits are important to achieve some economic ends but should be applied judiciously. At the same time , fairness, the ability to pay, and all the other criteria must be a part of our system.
To that end, the work of the Tax Review Commission should be put to good use. There should be a way to share the information in the report more widely to the public, to educate us on what’s wrong and what’s right with the present system, and how it can be corrected. I know it was presented at an informational hearing at the Legislature. I know that there were probably hearings in different districts before the present report was finalized. But that is not enough. More must be done to take the information to the public.
Giving the tax review commission the responsibility to follow and evaluate the ongoing changes to taxes as they occur will be more meaningful to our legislators and to the public and it might be a good idea to give them that responsibility whether they convene every five years or ten.
The annual or biennial reports would be more meaningful also to the public which really have a difficult time seeing all of the annual changes and the proliferation of tax credits etc. and make any sense as to the wisdom of these policies in relation to the principles of shaping good tax policies and their impact on future tax revenues . We hope that the commission will be given the resources to plan educational sessions for the public such as discussions on television programs, supplying speakers for organizations interested in the basics of a good taxation system, and other more creative ways of educating the public.
Whether you opt for five years or ten years, we hope you will amend it so that you make possible an ongoing review of annual or biennial changes. We also urge you to ensure that more resources will be provided future commissions to give them the ability to see that their product is well disseminated, and the education of the public can be an ongoing initiative.
Thank you for the opportunity to testify on HB 675.