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The Honolulu Advertiser
Posted on: Thursday, December 3, 2009

More home-tax relief stalls


By Gordon Y.K. Pang
Advertiser Staff Writer

The City Council Budget Committee yesterday deferred bills that would provide additional tax relief for O'ahu homeowners.

Budget Chairman Nestor Garcia, however, promised to push out some kind of tax break measure in the coming months for homeowners most in need of a break.

Bill 09-09 and Bill 09-75 are aimed at allowing more owner-occupants to qualify for the city's low-income tax credit, also known as a "circuit breaker."

The program targets those who need to pay a large share of their annual income toward property taxes.

To qualify now, a family must make no more than $50,000 in total income. The tax credit is that portion of a household's property tax bill that is above 4 percent of total household income. A homeowner must owe a tax to the city to receive the tax credit.

The deadline to apply for a tax credit each year is Sept. 30.

Bill 09-09 keeps the $50,000 total income eligibility but would allow more people to get a tax credit by lowering the tax threshold to no more than 3 percent of income.

Bill 09-75 eliminates the $50,000 total income eligibility requirement. It calls for capping property taxes at 3 percent of total income for households earning $50,000 or less, and 4 percent for households earning more than $50,000.

Garcia said he'd like to incorporate parts of both bills into one bill. Garcia said his committee also wants to give the administration time to provide revenue projections to see how much, if anything, the city can spare.