State Tax Credits Formally Taken to Task
Three formal proposals and a constitutional amendment to rein in tax credits and economic incentives were unveiled Thursday at the state Capitol.
House Bill 2976, would extend by two years a current moratorium on about 30 tax credits, which would give legislators time to assess each tax credit individually, said state Rep. David Dank, co-chair of the tax credit task force.
[bill id=”HB 2976″ state=ok session=”2012″ align=left]
The current tax credit moratorium was installed in 2010 to help offset a shortfall in state revenue. Extending the moratorium would save the state about $300 million in FY 2013, Dank, R-Oklahoma City, told The Oklahoman.
Suspended tax credits include those for railroads, coal, filmmakers and a small business tax credit and one for rural venture capital.
Not included: Quality Jobs Act, aerospace engineer incentive program, several oil and gas drilling credits.
[bill id=”HB 2979″ state=ok session=”2012″ align=left]
House Bill 2979 would end transferable tax credits.
When companies receive more credits than they owe in state taxes, they use the transferability feature, which lets them sell their surplus credits to other corporations or individuals, usually for about 80 cents on the dollar, wrote The Oklahoman’s Michael McNutt.
The third measure, HB 2978, would enact permanent criteria to evaluate new and existing tax credits and incentives and mirrors recommendations made by the tax credit task force.
[bill id=”HB 2978″ state=ok session=”2012″ align=left]
From The Oklahoman:
- All tax credits would require pre-approval by the Legislature.
- Tax credits would be subject to full transparency and to regular auditing by the state auditor and inspector’s office.
- Proposed tax credits would have to be accompanied by a fiscal impact statement detailing how it would affect the state budget
- All tax credits would be subject to caps and specific termination dates.
House Speaker Kris Steele, R-Shawnee, said he wants to amend the state constitution to include the tax credit criteria. House Joint Resolution 1089 would put the amendment up to a vote of the people in November.