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The Honolulu Advertiser
Posted on: Thursday, April 2, 2009

103 work days to pay taxes here

Advertiser Staff

The so-called "Tax Freedom Day" for Hawai'i residents is April 13 this year, or more than a week earlier than it was last year.

That's the estimation of the Tax Foundation, a nonprofit group that annually attempts to quantify taxpayer burden by calculating how many days residents in Hawai'i and other states will have to work to pay their federal, state and local taxes before earning money for themselves.

This year's date is the same day as the national average and is eight days earlier than last year, when the freedom day was April 21.

The Tax Foundation, based in Washington, D.C., said nationally the freedom day also falls eight days earlier than last year. That's primarily because the recession has reduced tax collections faster than it has reduced income and the American Recovery and Reinvestment Act of 2009 contains temporary tax cuts for this year and next.

The Tax Foundation ranked Hawai'i has having the 14th highest time period (103 days) for residents to work to pay off their taxes.

The highest number was in Connecticut (120 days). The lowest was in Alaska (82 days).

The annual study has been criticized in the past by the Center on Budget and Policy Priorities, another Washington-based group, as having problems with its methodology that overstates tax burden because it includes taxes paid by tourists. The think tank also has said the calculation is skewed by a small group of higher-income taxpayers.