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As the Joint Legislative Income Tax Review Committee had its annual review of income tax credits today, several groups called for increased transparency. The Arizona Public Interest Research Group (Arizona PIRG), Children’s Action Alliance, and the Goldwater Institute raised concerns that there is not enough information available to the public about the tax credit programs.
This year nine tax credits were reviewed, and three of those tax credits were reviewed in Executive Session. For the tax credits reviewed during Executive Session, members of the public and the media were not allowed to hear the reports from legislative staff and the Department of Revenue. The committee recommended repealing the three tax credits that were discussed during the Executive Session.
“It’s problematic that some of these tax credits were discussed behind closed doors today. The public should know how much is being spent on these tax credit programs and what the results of the program are,” said Serena Unrein, Public Interest Advocate for Arizona PIRG.
“Every year legislators have to authorize how to spend taxpayer money during the budgeting process. And every five or ten years they have to vote to retain each state agency and program when it hits a sunset date,” said Dana Wolfe Naimark, President and CEO of Children’s Action Alliance. “Even though tax credits are an allocation of dollars through the tax code rather than through appropriations, most never have to face another legislative vote once they are established.”
The groups contended that information about the effectiveness of tax credits should not be kept secret from the public. During the public testimony of the hearing, they recommended that legislation be passed to ensure that all tax credits include a sunset provision so there must be a vote of the legislature to continue a tax credit and include performance measures for each tax credit program be enacted and publicly reported. In addition, they called for the recommendations of this annual Joint Legislative Income Tax Review Committee hearing to be taken up by the legislature.
“Since so many legislators run on promises of increasing transparency, they should take a serious look at reforming the tax credit review process to make sure we are all treated equally before the law,” said Byron Schlomach of the Goldwater Institute. “Lawmakers should take today’s hearing as a lesson about how Arizona can be transparent about where tax dollars are going.”
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