Modifies provisions relating to unused tax credits
Summary
Senate Bill 723 aims to modify existing provisions related to unused tax credits in Missouri. It proposes the repeal of certain sections in state law which pertain to the administration and reporting of tax credits, exemptions, and deductions. The new provisions would focus on creating a more systematic approach to tax expenditures, emphasizing the necessity for annual reporting and analysis of these credits. This shift aims to enhance transparency around tax policy and its implications for state revenues.
One of the notable changes introduced by SB723 is the requirement for state departments to submit a detailed tax expenditure budget annually. This budget will outline the anticipated reduction in revenue due to each tax preference and will include a cost-benefit analysis of various specific tax incentive programs. The bill clearly establishes that these estimates will play a crucial role in guiding appropriations and budget discussions in the general assembly, thus attempting to hold state entities accountable for tax policy impacts.
The bill highlights ongoing concerns about fiscal management and accountability regarding tax credits. By enforcing a review and approval process for new tax credits—except those for senior citizens' property tax—it intends to curb the proliferation of credits that could strain state finances without adequate justification. The maintenance of a report detailing any tax credit programs that haven’t seen usage in the last five years aims to streamline tax expenditures and eliminate inefficient or unused credits.
Critics of such legislation may raise concerns about the potential for increased legislative oversight to stifle innovation in economic development initiatives. They might argue that the strict parameters for new credits could limit opportunities for local businesses and hamper economic growth. Conversely, supporters of SB723 generally see these changes as prudent measures to ensure that taxpayer resources are being utilized effectively and responsively, resonating well with the ongoing dialogue around responsible governance and economic viability.