Proposal Would Mandate More Oversight For State Tax Credits
A group of more than a dozen Beacon Hill lawmakers are calling for more stringent measures to keep tabs on tax credits that are given out to businesses.
An amendment in next year's state budget would create a website that would publish reports detailing which companies receive tax credits, how much the tax credit is for and the date it is issued.
Some in the business community say the requirement unfairly focuses on businesses and could be a slippery slope toward giving out confidential tax and trade information.
âExposing individual taxpayer information we believe is wrong,â said Eileen McAnneny, a senior vice president for the Associated Industries of Massachusetts. âThere should be some privacy and confidentiality around taxpayers and singling out businesses to have these extra reporting requirements we feel is ill advised.â
Sunshine Provision
The call for increased transparency was included by lawmakers in an amendment to the House of Representatives' version of next year's budget. The issue must still be considered by the state Senate and would have to be signed by the Governor before taking effect. State Sen. Jamie Eldridge, D-Acton, has promised to pursue the issue in the Senate.
Backers of the amendment say the issue is one of transparency. No confidential information will be divulged by the state, they argue. While some of this information is currently available in the aggregate there is no central location to search for all the tax credits that are given to businesses each year.
âAt the end of the day, this is the people's money and we need to make sure these programs are working,â said State Rep. Danielle Gregoire, D-Marlborough, a co-sponsor of the legislation.
Gregoire said these are fairly basic questions that should be easy to answer.
The new regulations would affect the brownfields tax credit, the film tax credit, the dairy farm tax credit, the medical device tax credit, the low-income housing tax credit, the economic development incentive program and the Massachusetts Life Sciences Center investment tax credit.
Melissa Walsh, COO for the Life Sciences center, which is based in Waltham, said the center already requires the information outlined the in the amendment, plus more. Each company that receives a Life Sciences Center grant must submit an annual report detailing how the money was used and how many jobs were created because of the grant.
Framingham-based GTC Biother-apeutics was one of the companies that received Life Sciences Center funding. Specifically the company will be able to take a tax credit of up to $300,000 that will be applied to this year's taxes, according to Jack Green, CFO of GTC.
âGenerally speaking I don't have a problem with the state publishing the amounts of the tax credits,â Green said. âThat should be public information.â
However, Green added that he does share concerns from AIM that it's important to keep confidential taxpayer information and details of how the money was spent.
For example, he would be against regulations requiring companies to divulge in which departments and sectors the company added employees. Doing so could provide clues to competitors about where the company is making investments.
âProprietary information is critical to competitive positioning in our industry,â Green said. âThat must be protected.â n
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