New report makes case for exempting medical providers from Hawaii’s GET

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The next is a information launch that was issued Jan. 30, 2023, by the Grassroot Institute of Hawaii.
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A Grassroot Institute of Hawaii coverage temporary contends eradicating the tax would decrease medical prices and assist alleviate the state’s physician scarcity

HONOLULU, Jan. 30, 2023 >> The Grassroot Institute of Hawaii right this moment launched a coverage temporary explaining why medical providers ought to be exempted from the state’s normal excise tax.   

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The new publication, written by Institute Coverage Director Malia Hill, outlines how such an exemption would each decrease medical prices for sufferers and assist alleviate the state’s crucial physician scarcity.

Keli‘i Akina, Institute president and CEO, mentioned the brand new temporary is meant to assist state lawmakers perceive why exempting medical providers from the GET is sensible and value reaching.

“I do know there are a half-dozen payments within the 2023 Legislature already that suggest such an exemption, whether or not wholly or partially.” Akina mentioned, “However for any legislators nonetheless sitting on the fence about this concern, I hope this info will transfer them to totally assist this affordable and wanted proposal.”

The Institute’s new temporary, “The case for exempting medical providers from Hawaii’s normal excise tax,” explains that not-for-profit services resembling hospitals are already exempt from the state’s GET, however that personal apply physicians should pay the the state’s base 4% GET, plus any county surcharges, which at present are capped at 0.5%. 

The report says that as a result of the GET is a gross receipts tax, “it turns into a major overhead expense for personal apply physicians, making it extraordinarily troublesome to be worthwhile — particularly for brand new docs who’re simply beginning out and nonetheless paying their scholar loans.”

The Hawaii Doctor Workforce Evaluation Challenge lately estimated that Hawaii is brief 776 full-time-equivalent physicians. The best want is in major care, however Hawaii additionally desperately wants specialists –– particularly on the neighbor islands, the place getting specialised care is harder and infrequently necessitates flying to Oahu for remedy. 

Primarily based on prior Institute analysis, Hill states {that a} medical providers exemption from the state GET would scale back state tax revenues by estimated $222 million a yr. Nonetheless, “because the state has a $2.6 billion surplus for fiscal yr 2023, and is anticipating a surplus of about $10 billion over the following 4 years, it’s in a wonderful place to afford such a tax exemption.” 

Hill provides: “To the extent that the exemption would assist resolve Hawaii’s physician scarcity, the $222 million might be thought-about cash properly spent.”

To learn or obtain the brand new Grassroot Institute coverage temporary, go right here.

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