In the Tuesday Wall Street Journal, Professor Alan Blinder wrote of his puzzlement at the very slow growth of productivity in the last three years. There is really no mystery. The rate of growth of investment in...
- The Tax Policy Blog
- Missouri to Look More Closely at Ineffective Tax Credits
Missouri to Look More Closely at Ineffective Tax Credits
Missouri Governor Jay Nixon (D) has asked the state’s Tax Credit Review Commission to meet on September 12 after news broke of a 15 percent increase in state tax credit claims by taxpayers.
The Commission had issued a report (PDF) back in late 2010, reviewing the state’s tax credits. They calculated that tax credits altogether reduced the state’s general revenue by 8 percent, with many of them unjustifiable, inefficient, ineffective, or better suited for the annual appropriation process. They recommended that the Legislature eliminate 28 special interest tax credits, revise another 30 credits, adopt sunset rules and budget caps on all remaining credits, and seek to buy back outstanding tax credits to prevent future budget problems.
The Legislature considered the changes in 2011 but progress was stymied by recipients of some of the credits. For example, the Commission recommended capping historic preservation tax credits at $75 million; the latest numbers show the state paid out over $130 million in such credits. State Rep. Chris Kelly (D) put it quite colorfully:
"As long as you talk about tax credits generically, they are Satans," Kelly said. "As soon as you or the governor or anybody else starts talking about them as individuals, they are angels."
Subscribe to the Tax Foundation Newsletter
Join the Tax Foundation's fight for sound tax policy Go
About the Tax Policy Blog
The Tax Policy Blog is the official blog of the Tax Foundation, a non-partisan, non-profit research organization that has monitored tax policy at the federal, state and local levels since 1937. Our economists welcome your feedback. If you would like to send an e-mail to the author of a blog post, please click on that person's name to locate his or her e-mail address or visit our staff page here.