Report: Ohio expands tax breaks, but oversight lacking
Posted February 24, 2016 in Selected Press
Ohio lawmakers have increased spending on tax breaks, but fiscal oversight of billions of dollars in these tax exemptions, credits and deductions is lacking, a new report from Policy Matters Ohio says.
These "tax expenditures" will total almost $9 billion in the 2017 fiscal year. The tax breaks apply to certain goods and services, industries, activities, individuals and companies. They make up a significant share of overall state spending, but they are not regularly reviewed.
Unlike budget spending on public services such as parks, schools and universities — which are reviewed regularly — tax expenditures remain in law indefinitely unless there is a pre-existing termination date.
The 2016-17 tax expenditure report listed 128 items that account for the aforementioned $9 billion. Many date back decades to when the economy and technology were far different. One dates back to 1896.
"Ohio spends as much on tax breaks as it spends in the operating budget on K-12 education," said Senior Project Director Wendy Patton, who co-authored the report. "Without review, nobody knows if these tax breaks are still economically useful."
While the Ohio General Assembly has ignored proposals from Gov. John Kasich to eliminate some tax breaks, there is momentum among lawmakers to provide better oversight. House Bill 9, which passed the House in June 2015, would create a legislative committee to review tax expenditures at least once every eight years.
Separately, the new "2020 Tax Policy Study Commission" is to review and evaluate all state tax credits, among other things, and has scheduled a hearing on tax expenditures today.
But the state could go much further to review tax breaks and improve fiscal accountability, the report says.
Original Article: http://www.norwalkreflector.com/Financial/2016/02/...