Current law requires a legislative declaration stating the intended purpose of a new tax expenditure or the intended purpose for extending an expiring tax expenditure. The act expands that law by:
- Requiring a statutory legislative declaration, not nonstatutory;
- Requiring any bill that creates a new tax expenditure to include a repeal of the expenditure after a specified period of tax years and any bill that extends an expiring tax expenditure to extend the expenditure for a specified period of tax years; and
- Requiring the statement of the intended purpose to be a part of a tax preference performance statement, which includes:
- The classification of the type of the tax expenditure; and
- Detailed information regarding the legislative purpose of the tax expenditure, which, at minimum, includes clear, relevant, and ascertainable metrics and data requirements that allow the tax expenditure to be measured for effectiveness in achieving the intended purpose.
(Note: This summary applies to this bill as enacted.)