Bill Virgin asks some good questions in his recent column on state tax breaks for corporations:
- Does the facility involved support other companies in the region?
- Does it conduct research and development that might lead to growth at the company, or create opportunities for spinoffs?
- Does it provide a market for a locally produced raw material?
- What would the region lose if the activity went somewhere else?
But one additional question should also be asked:
- When will the tax break “sunset”?
In other words, by when must legislators review and re-authorize the tax break before it automatically expires?
After all, if every tax increase – school, park or fire levy, sales tax change, etc. – must go to a vote of the people, then special exceptions to our state tax code ought to face some regular scrutiny as well.
An automatic sunset, say every five years, would give legislators (and their constituents) the opportunity to re-examine the trade-offs inherent in any change to the tax code, and ensure they still make sense for our state.
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