HB 2721 states that hundreds of tax exemptions and special tax preferences have been granted to special interests by the legislature without requiring assessment of whether those exemptions and preferences would create jobs or result in increased economic activity which increases state revenues. Exemptions and preferences result in the entire tax system being less fair for people who do not have special exemptions and preferences, and increase the taxes on all other taxpayers in order to fund education and other state services.
The bill establishes the tax exemption transparency and accountability act. It creates a tax expenditure budget as part of the biennial budget adopted by the legislature to reform the tax expenditure process by including tax expenditures in the tax expenditure budget in the biennial state budget process. HB 2721 requires the Department of Revenue to prepare a tax expenditure budget biennially.
Additionally, the bill requests the governor to review the tax expenditure budget from the Department of Revenue and submit it as part of the biennial budget documents, changes the name of the "citizen commission for performance measurement of tax preferences" to the "citizen commission for performance measurement of tax expenditures," changes the duties of the joint legislative audit and review committee and the citizen commission for performance measurement of tax expenditures with regard to the tax expenditure budget.