comscore Higher alcohol tax will destroy restaurant and hospitality jobs | Honolulu Star-Advertiser
Editorial | Island Voices

Higher alcohol tax will destroy restaurant and hospitality jobs

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By now, it’s old news that Hawaii’s economy is hurting — one in every 16 people is unemployed, visitor arrivals remain inconsistent and state experts forecast the recovery phase as at least a year away. As Hawaii’s people wither, Hawaii’s government follows.

As taxpayers, we can understand the desperation of our state government and its leaders as they struggle to find funding for its programs, but generating revenue by levying more taxes upon Hawaii’s businesses now, when we are just starting to recover, is both socially and fiscally irresponsible.

The proposed increased tax on alcohol currently making its way through the Legislature will bleed restaurant and hospitality industries that are already strained under the burden of decreased spending and tourism while trying to manage increased operational costs such as electricity and water.

It will undoubtedly drive down visitor spending, just as it is beginning to show signs of revitalization. Visitors on thin budgets will have to plan more frugally to account for the increased duties; some may avoid Hawaii altogether and opt for a cheaper version of paradise somewhere else.

Hotel and restaurant staff, managers and owners have come out to oppose the tax and the adverse effects it will have on the industry’s ability to survive.

All restaurants, especially smaller ones, stay afloat on razor-thin profits, and such a tax would have to be passed on to the consumer. A $10 drink becomes a $13 or $14 drink.

Meanwhile, consumers and visitors alike will look at the menus and be put off by the high prices, taking their business elsewhere — or maybe just staying home. As restaurants lose business, they will decrease their labor force — whether by cutting hours or terminating employees, there’s less work, and wages, to go around.

And then there’s the trickle-down effect. Thousands of workers, many of them supporting families, going to school, will have less money to spend on the things that they want and need; less money in their pockets means less in the pockets of markets like Times and Foodland and less in the pockets of retailers and staff at Ala Moana and Pearlridge shopping centers. In the end, the tax comes full circle as the state makes less tax revenue from businesses statewide.

Hawaii’s alcohol taxes are already among the highest in the entire nation. If lawmakers want to tax an industry, they should pick one that is not already taxed to the breaking point. Singling out one industry and its employees is discriminatory and unfair.

This tax does not help Hawaii’s tourism. It does not help Hawaii’s unemployment. This tax does not help Hawaii’s economy or its working people. Our legislators are scrambling for solutions, but at what cost? At the end of the day this tax will not even generate enough money to pay for the damage it is sure to cause with the loss of thousands of jobs.

Other solutions exist. Government needs to look at its own spending habits before reaching further into the wallets of its already strapped citizens.

Save our Jobs Hawaii is a coalition of individuals, small local-based businesses, retail stores and restaurant owners, mom-and-pop grocers and the many employees of Hawaii’s hospitality industry who have come together to voice their concerns to state lawmakers on taxes that kill jobs.

To join the coalition or for more information, see www.SaveOurJobsHawaii.com.

Roy Yamaguchi is founder of Roy’s Hawaiian Fusion Cuisine; Don Murphy is owner of Murphy’s Bar and Grill; and Thomas H. Jones is president of Gyotaku Restaurant and co-chairman of the Hawaii Restaurant Association’s government affairs committee.

 

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