Given Hawai'i's high cost of living, it's discouraging that local families living in poverty continue to pay some of the highest state income taxes in the country.

Discouraging, but hardly shocking. Hawai'i's tax burden on the poor has long been a target of criticism — the income tax, yes, but also the heavily regressive general excise tax, which disproportionately affects the poor.

And even though the state is facing deep cuts in spending next year, providing some tax relief to those who need it most should remain a top priority in the next legislative session.

Last week's report from the Center on Budget and Policy Priorities illustrates why.

Not only does Hawai'i levy taxes on people below the federal poverty line, it does so more robustly than nearly every other state.

For a two-parent family of four with an income at the federal poverty threshold of $21,203 in 2007, the tax was $409 — the second highest in the country. For a single-parent family of three, at the threshold of $16,530, the tax was $316 — the nation's highest.

While this burden is bad enough, the general excise tax — which applies to most things bought and sold — affects low-income residents' purchasing power more severely than others. Since the poor spend a higher percentage of their income on necessities — food, clothing and shelter, for instance — they are more vulnerable to price increases than those with more wealth.

The evidence of this vulnerability is anecdotal, but hard to ignore. Hawai'i food banks and free food pantries are reporting sharp increases in demand. The Hawai'i Housing Policy Study reports about 100,000 people living in overcrowded conditions — the "hidden homeless," just a paycheck away from the streets. And there are the homeless themselves, whose numbers have increased from Wai'anae to Waikiki and become an increasing burden on social services agencies.

Clearly, it's in the best interests of Hawai'i to allow the working poor to support themselves by keeping more money in their pockets.

But the Center on Budget and Policy Priorities' figures suggest that so far the efforts remain lackluster. The report cites some progress: expanded tax brackets and higher thresholds to reduce taxes on low-income families. Raising the standard deduction for married couples to $4,000 was another modest step forward.

But more aggressive proposals have gone nowhere. A state earned income tax credit, pegged to the federal EITC, remains untested. So is a hefty boost in the standard deduction, an option the Lingle administration prefers.

These and other targeted tax relief proposals should be reviewed by policymakers to provide maximum help for those who need it most.

In these tough economic times, such relief may have to be phased in gradually. But it should not be sidelined. The need for relief is too great.