SENATE REPORT
 Senator Michael Gibbons

FOR IMMEDIATE RELEASE -- November 13, 2003

JOINT COMMITTEE STUDIES EFFECTIVENESS
OF MISSOURI'S TAX CREDIT PROGRAM

JEFFERSON CITY -- While Missouri's tax credit program is a valuable economic development tool for both urban and rural communities, reform efforts are needed to improve the system's efficiency and make it more accountable to the taxpayers of the state. On Wednesday, the Joint Committee on Tax Policy, chaired by Senate Majority Floor Leader Michael R. Gibbons, R-Kirkwood, heard testimony from more than 20 witnesses about the various programs.

The meeting, which had been scheduled for over a month, came in the wake of the publication of several articles by the St. Louis Post-Dispatch uncovering fraud and abuse in the Rebuilding Communities tax credit program administered by the Missouri Department of Economic Development. The Missouri Attorney General's office is currently undertaking an investigation of accusations.

"No one wants to jump to any conclusions, but we need to look and see what's going on. The purpose of tax credits is to spur economic growth, not to enhance an individual's wealth," Gibbons said. "We're not doing our job of protecting the taxpayers if we're letting this kind of waste, fraud and abuse occur."

Missouri currently has 54 tax credits statewide, with 32 of those administered by the Department of Economic Development.

Many of these programs have been in existence for 15 or 20 years and have not been updated or modified.

According to Gibbons, the Tax Policy Committee must look at the following issues:

  • Which tax credit programs have been used most effectively in Missouri?
  • What programs have a large amount of waste and can be either consolidated or eliminated?
  • What can be done to make tax credits more cost effective for the people of Missouri?

    "We need to figure out which programs need to be modernized or streamlined, so that taxpayers get a better return on their investment," said Gibbons. "Taxpayers need to feel like these tax credits are a good use of their money."

    For additional information, contact Gibbons' Jefferson City office at (573) 751-2853.