Governor rules out increase in general excise tax

Gov. Neil Abercrombie said today that he would not consider a general excise tax increase to help close the state’s budget deficit.

The governor urged state lawmakers to use the revenue-generating options he outlined in his budget plan in February and proposals offered by state House and Senate leaders to reduce the projected two-year $1.3 billion gap.

"The budget can be balanced. The core services can be delivered. The jobs program can get underway. All without doing the GET," Abercrombie said in an interview in his office in the state Capitol.

The general excise tax is the largest source of state revenue. The broad based tax has not been raised since 1965.

The Abercrombie administration indicated that it would consider a House proposal to temporarily suspend general excise tax exemptions on certain business activities and impose a GET on those activities over the next few years. The bill was a significant component of the House’s plan to balance the budget, but the Senate Economic Development and Technology Committee voted this month to hold the bill.