Lack of tax expenditure oversight allows costs to grow out of control

State spending on tax preferences or “tax expenditures” is largely exempt from the rigorous and routine scrutiny that is applied to direct spending on public services like health care and education.

• Tax expenditures are not part of the state budget process;
• Tax expenditures are open-ended;
  
• Excessive restraints make tax expenditures difficult to modify; and
  
• Policymakers are not required to act on tax expenditure audit recommendations.
  

As described in the box below, which is from our latest policy brief, one of the major problems with our current budget process is that unmonitored tax expenditures can experience out of control growth. (Click on the box to enlarge the image.)

Now more than ever, policymakers and the public are taking a careful look at all public spending choices we make in Washington state. Tax expenditures should not be the exception; they should be treated like any other form of state spending.

For more information on tax expenditures and reforms to our state budget process check out our new policy brief, Every Dollar Counts: Why it’s Time for Tax Expenditure Reform.