The folks over at the Washington State Budget and Policy Center(opens in new tab) have just released a new report titled Every Dollar Counts: Why it’s Time for Tax Expenditure Reform(opens in new tab).
The report takes a hard look at Washington state’s revenue and expenditure process, and determines our state budget shortfall could be significantly eased with more “effective management of our state resources” (read: ending(opens in new tab) selected(opens in new tab) tax(opens in new tab) exemptions(opens in new tab)). It also serves as a blueprint for elected officials interested in prioritizing state spending in a more holistic way – and determining the true priorities of government(opens in new tab).
The report identifies 5 key reforms policymakers need to make in order to balance the costs and benefits of specific tax exemptions against tax increases for other taxpayers, and widespread cuts to critical public services.
Their recommendations:
- Establish routine oversight by requiring expiration dates for all tax expenditures;
- Improve fiscal management by allowing tax expenditures to be modified via a simple majority in the legislature;
- Foster transparency through an executive tax expenditure budget;
- Ensure tax expenditures are cost-effective by enhancing audit and review structures; and
- Enforce accountability by enacting strict eligibility requirements for businesses that receive tax expenditures.
These reforms should appeal to people across the political spectrum, from deficit hawks to social justice advocates. They are a key first step in evaluating spending on tax breaks to ensure all state expenditures are given equal consideration during difficult budget years.
Read the full report here »(opens in new tab)