GASB Proposes Tax Abatement Disclosures by State and Local Governments

Monday, November 17, 2014 10:37 AM | NCSA Website Manager (Administrator)
State and local governments would have to disclose information about property and other tax abatement agreements for the first time under a proposal issued by the Governmental Accounting Standards Board.
 
Governments carve out tax abatement packages for companies, businesses and other taxpayers to boost "economic development, job growth, redevelopment of blighted or underdeveloped areas, and other actions that are beneficial to the government or its citizens," GASB said in a news release. However, "little information is publicly available regarding the provisions of tax abatement agreements or the magnitude of the effect those agreements will have on the ability to raise resources in the future," GASB said in an exposure draft issued Oct. 31.
 
According to the draft standard, the disclosures proposed by GASB would include:
·?general descriptive information, such as the tax being abated, eligibility criteria for granting of the abatement and provisions for recapturing abated taxes;
·?the number of abatement agreements;
·?the dollar amount of taxes abated; and
·?other commitments made by a government as part of the abatement accord, such as to build infrastructure assets.
 
Comments on the proposal should be submitted by Jan. 30, 2015, GASB said.  The news release and exposure draft are available here.


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