October 29, 2012

Tanzi: State Must Monitor Effectiveness of $1.7 Billion Worth of Tax Breaks

Representative Teresa Tanzi continues to be a fiscal watchdog, calling on the state to begin close monitoring of the effectiveness of $1.7 billion worth of tax breaks contained in the 2012 Tax Expenditures Report published recently by the state. “The state grants these tax breaks without a regular review to determine the benefit to the economy or to our taxpayers,” said Tanzi. “No one is looking at the $1.7 billion we are foregoing annually.”

Tanzi said that once a tax expenditure is added to the tax code, it can remain there indefinitely without any scrutiny or evaluation of whether it is necessary or yielding a positive return for the state.

For the past two years, Tanzi has introduced legislation with strong bipartisan support requiring any new tax break to include a statement about what it is supposed to accomplish, ways to measure outcomes, and expiration dates that would provide the General Assembly with an opportunity to positively reaffirm its effectiveness. She has also submitted and will continue to introduce legislation creating a commission to review all existing tax expenditures and make recommendations over time as to whether to maintain, strengthen or eliminate each tax- expenditure program.