A statewide research and policy organization is urging Connecticut lawmakers to combat Connecticut’s deficit by taking a hard look at the $7.2 billion lost through tax expenditures.
Connecticut Voices for Children (CVC), which seeks to advance public policies benefitting the state’s children, youth and families, said on April 4 that, unlike with spending on other services, no public debate will be held on the $7.2 billion of revenue lost through tax expenditures in the coming fiscal year – a figure it says has grown by over 70 percent since 2000.
“Every dollar of spending on schools, social services, and transportation is scrutinized for cost effectiveness, but tax expenditures are rarely evaluated or addressed,” said Nick Defiesta, associate fiscal policy fellow at CVC. “We need to hold spending through our tax code just as accountable as spending through the appropriations process.”
The group maintains that the $7.2 billion roughly equals 40 percent of the General Fund, and should receive the same degree of public scrutiny and consideration. It recommends an expansion of the Office of Fiscal Analysis’ biennial Tax Expenditure Report to include evaluation of how well the tax expenditures are functioning and whether they should be continued, repealed or modified.
It also proposes strengthening the legislative review process for tax expenditures by holding public hearings on the Tax Expenditure Report, and by requiring the Finance Committee and the General Assembly to take the public’s testimony into account when voting on the report’s recommendations. Currently legislators are not required to act upon the report’s findings.
“Holding $7.2 billion in tax expenditures accountable is an important step to getting our fiscal house in order,” said Derek Thomas, Fiscal Policy Fellow at CVC. “Strengthening our review process will help Connecticut ensure all spending is on behalf of the public good.”