Click to enlarge: RI tax revenue compared to tax breaks |
But nobody really
knows how this $1.7 billion investment is doing for the state because nobody is
paying attention to the money we aren’t getting.
A bill being considered by the House Finance
Committee would remedy that wrong. It’s sponsored by Rep. Teresa Tanzi of South
Kingstown and Reps. Walsh, O’Grady, Valencia and Ferri have each signed on.
They’ve got a strong ally in the Economic Progress Institute, too, which released a report on the issue that will do a far better job than me at explaining why this is a no-brainer for the Ocean State.
They’ve got a strong ally in the Economic Progress Institute, too, which released a report on the issue that will do a far better job than me at explaining why this is a no-brainer for the Ocean State.
Here’s the condensed
version from their release:
To ensure Rhode Island
uses its available resources in the most effective way possible, it’s time to
subject tax breaks, that cost the State over $1.7 billion a year, to the same
scrutiny given to money spent through the state budget.
Like
other states, Rhode Island increasingly writes into law provisions that allow
people or businesses to reduce their taxes if they meet certain criteria. But
Rhode Island is among the states that pay the least attention to whether tax
breaks for businesses achieve their stated goals, according to a recent study by The Pew Center on States.
The reputable research organization listed Rhode Island among 26 states that
are “trailing behind”—Pew’s lowest ranking—because the State met none of the
criteria for the scope or quality of evaluation key to determining whether tax
breaks are worthwhile policy.
Pew found that while
no state “regularly and rigorously tests” whether tax breaks for businesses are
benefiting a state, 13 states are “leading the way” in generating answers about
the effectiveness of their state’s tax breaks.2 Rhode Island should follow the
lead of the exemplary states, including neighboring Connecticut, that are
taking important steps to more carefully examine some or all of their tax
breaks, particularly those enacted with the goal of creating jobs.
Bob Plain is the editor/publisher of Rhode Island's
Future. Previously, he's worked as a reporter for several different news
organizations both in Rhode Island and across the country.