Governor Malloy’s budget director, Benjamin Barnes, told the Finance Committee this week that a proposal to publicly disclose confidential tax information about many Connecticut businesses would “send the message that Connecticut is ‘closed for business.’”
In written testimony, Barnes reminded the committee that state lawmakers passed the credits, deductions and exemptions in order to promote economic development, job growth and more investment in the state.
Under HB 6560, the Department of Revenue Services would make public a list of businesses accessing state-provided deductions, credits or exemptions, along with the actual amount of tax savings and advantages realized by each company.
But making that information public would “create a disincentive for companies to conduct business in Connecticut,” said Barnes, adding that it would cause harm to businesses “simply availing themselves of tax code provisions granted by the General Assembly.”
No other state requires or permits the disclosure of company-specific data if a business is using tax credits, deductions or exemptions. Connecticut and some other states do allow the disclosure of combined data that does not name specific companies. The DRS compiles and releases this aggregate data to the Office of Fiscal Analysis, which uses it for their biennial reports to the legislature.
Ron San Angelo, acting commissioner of the Department of Economic and Community Development (which administers many tax credit programs), said HB 6560 conflicts with state protections of tax returns and other proprietary information. If disclosed, that information “could be utilized by the business’ competition providing insight on the profitability and capital investments made by that business.”
CBIA urges the committee to reject HB 6560. For more information, contact CBIA’s Bonnie Stewart at 860.244.1925 or email@example.com.