Relating to a periodic review and expiration dates of state and local tax preferences.
Once enacted, SB140 will significantly impact existing statutes governing tax preferences by introducing automatic expiration clauses and review requirements for tax preferences established after September 1, 2014. This requires all new tax incentives to have a defined lifespan unless a legislative body decides otherwise through further action. The bill emphasizes the importance of assessing the benefits of tax preferences against their costs, particularly how they influence economic development and public funding.
SB140 introduces regulations regarding the periodic review and expiration dates of state and local tax preferences in Texas. By establishing a framework under which these tax preferences will be reviewed every six years, the bill aims to ensure that any benefits provided to taxpayers through credits, exemptions, or discounts are justified and remain relevant to the state's fiscal objectives. The Comptroller of Public Accounts is tasked with developing a review schedule and allowing public input on this schedule, promoting transparency and accountability in the process.
The discussions around SB140 reflected a general sentiment towards promoting fiscal responsibility and effective governance. Supporters of the bill praised it as a proactive measure that could help fine-tune Texas's approach to taxation, ensuring that the state's revenue is used efficiently. Conversely, some opponents expressed concern over the potential impact of automatic expirations on businesses reliant on these tax advantages, fearing that it could lead to instability in tax policy.
Notable points of contention included the balance between promoting economic development through tax incentives and the need for accountability concerning their efficacy. Critics were particularly worried about the complexities introduced by needing legislative action for the renewal of tax preferences, which might lead to inconsistent economic signaling to businesses. The challenge remains to effectively communicate the benefits of such revisions while protecting the state's economic interests and promoting equitable taxation.