Massachusetts Business Tax Breaks Evaluated in New Report
A new MASSPIRG study asks if Bay Staters are “Getting Our Money’s Worth?” from the Commonwealth’s corporate tax breaks. The organization evaluates 25 different special business tax subsidies for fiscal safeguards and accountability and transparency practices. Among other findings, MASSPIRG concludes that:
- Less than one-third of the subsidies are subject to annual spending limits.
- Few of the Commonwealth’s special business tax subsidies have well-articulated public policy goals.
- Nearly half of all business tax subsidy programs fail to publicly disclose information important for transparency such as recipient names, program-wide cost to the state budget, or results generated by the program.
MASSPIRG also finds that state spending on business tax subsidies has more than doubled since 1996; the Commonwealth spent an estimated $770 million in 2012 through programs such as the Economic Development Incentive Program and the Film Tax Credit. MASSPIRG’s recommended policy options to help the state get the best results from its substantial spending on special business tax subsidies include:
- Transitioning from business tax breaks to outright grants.
- Adding mandatory public policy goals and expiration dates to new and existing subsidy programs.
- Continuing to improve disclosure of subsidies awarded through these programs.
You can read the rest of the organization’s recommendations to help the state get the biggest bang for its buck in Getting Our Money’s Worth? here.