An Act Requiring A Cost-benefit Analysis Of State Tax Expenditures.
Impact
The implementation of HB05169 would have significant implications for state fiscal policy. By requiring periodic evaluations of tax expenditures, the bill aims to provide lawmakers with critical insights into the effectiveness and efficiency of various tax incentives and breaks. This could lead to informed decisions about which policies to continue, modify, or eliminate, thereby optimizing state revenue and spending. Such evaluations could potentially identify tax policies that are underperforming or leading to unintended consequences, which may affect legislative priorities and budget allocations.
Summary
House Bill 05169, introduced by Representative Reynolds, seeks to mandate a systematic cost-benefit analysis of all state tax expenditures. This analysis would be conducted every five years, starting in fiscal year 2011, with the result being submitted to both the Governor and the legislature. The primary aim of this bill is to enhance transparency and accountability in the management of state resources by ensuring that tax expenditures are evaluated rigorously and regularly for their economic impact.
Contention
While the bill aims to promote better fiscal management, it may face opposition from stakeholders who benefit from current tax expenditures. Critics might argue that frequent evaluations could threaten existing incentives that support certain sectors or industries, leading to potential job losses or adverse economic impacts if these incentives are scaled back or removed. Additionally, there may be concerns regarding the resources needed to conduct thorough analyses and whether the findings will be acted upon meaningfully by lawmakers.