July 31, 2002
Study: Hawaii last in offering positive small-business
climate
Ben DiPietro
Hawaii ranks last among all states for fostering
a climate that is friendly to small businesses, according
to a 2002 study from
the Small Business Survival Committee.
The study ranks states and the District of Columbia on
20 government-imposed costs that are saddled on small
businesses,
including taxes, workers' compensation costs, utility
costs and health-insurance costs as well as the minimum
wage.
Only the District of Columbia posted a lower ranking
than Hawaii.
Hawaii ranked 49th among the states in the
group's 2001 survey.
"Hawaii benefits from imposing no added death taxes.
However, Hawaii ranks poorly in terms of personal income
taxes, capital
gains tax, sales, gross receipts and excise taxes, unemployment
taxes, electricity costs, workers' compensation costs
and the
crime rate," the business-advocacy group said Tuesday.
The
top five states in the study are South Dakota, Nevada,
Wyoming, Texas and Florida.
According to the group, Hawaii
has the nation's second-highest sales/excise tax, third-worst
unemployment tax and seventh highest personal income
tax, despite several years of lowering that rate. The
state ranks 30th in corporate tax, 10th worst in capital
gains tax and the sixth-lowest in property taxes.
"Since small business is the true driving force
behind economic growth, every state and local lawmaker
should be concerned with the well-being of small business," study
author Raymond Keating said.
Jim Tollefson, president
of The Chamber of Commerce of Hawaii, says the state
has made some strides to be more smallbusiness friendly,
but says much work needs to be done.
"We at the
chamber are looking for ways to improve the business
climate," Tollefson said. "Whether
we are No. 50 or No. 1, we'd be doing the same thing."
Christine
Camp, managing director of Avalon Development and vice
chairwoman of the chamber, said business groups will
push lawmakers next year to speed up the depyramiding
of the general excise tax.
The current sevenyear plan
to depyramid the G.E.T. is too slow and must be sped
up, Camp said. Another new law that makes the Small Business
Regulatory Review Board permanent will now force state
agencies to produce impact statements detailing the impacts
their proposed rules would have on local small businesses.
"From a regulatory standpoint, small businesses
are just bound by myriad rules from different agencies
at the state, county and city levels," Camp said. "And
the pyramiding of the G.E.T. really hurts. The G.E.T.
depyramiding has to be accelerated."
Camp says while
it's easy to start a business in Hawaii, the high costs
here make it hard for companies to survive, especially
mandated health-care premiums employers must pay for
all employees who work 20 or more hours.
"Health-care costs are one of the highest [expenses]
and have been a sore point," Camp said. "We
need congressional action to change that. The workers'
comp law is very complicated. The cost of doing business
is high but, being a small-business person, I cannot
agree that we would be the worst."
Pacific
Business News (Honolulu) - July 31, 2002
http://pacific.bizjournals.com/pacific/stories/2002/07/29/daily51.html
© 2002 American City Business Journals Inc. |
