Have you ever received a bill you weren’t expecting? Maybe it was a doctor’s visit your insurance didn’t cover, or you forgot to cancel a subscription and the $100 renewal fee hit your checking account. Or maybe it was an unexpected expense like your car battery dying, and there goes $200. If you’re anything like me, you’re left shocked and frustrated. It always seems like as soon as you put that extra money into your savings account you’ve got to pull it right out for something else.
Well, Tennessee taxpayers, don’t say we didn’t warn you when this bill rears its ugly head. Earlier this week the Tennessee Department of Revenue released a report detailing how much the state gave out in tax credits in 2019. This is only the third year we have ever had access to this information, as the report was mandated by law back in 2017.
In turns out that in 2019 alone, the state gave out over $201 million in tax credits to various businesses and corporations. Additionally, the report showed how last year’s report detailing 2018 understated the amount given in tax credits by nearly $45 million.
If you can believe it, that is not even the worst part. What is worse is the balance of tax credits that have been awarded but not claimed. According to the Department of Revenue, the state has a jaw-dropping outstanding balance over $937 million that have been awarded to companies that haven’t been claimed yet. This is a staggering debt that could be a black cloud over the state’s finances. In all likelihood, these companies with unclaimed credits are waiting to claim these when the economy slows down or when we’re faced with the next recession. If this nearly one billion dollar debt comes due when the state government is already facing lower revenues due to a recession, it could mean large tax hikes for people like you and me to balance the budget.
When we talk about such large expenditures of public money, taxpayers deserve the right to know who is receiving this money and if these companies are being held accountable. Yet, we can’t even do that, as tax credits—unlike other forms of corporate welfare like cash grants—are not publicly disclosed. Chances are there isn’t another expenditure in the state’s budget of over $200 million where we have no idea who it went to or how it was spent. It is this lack of transparency that leads to a near billion-dollar liability in the first place.
Tennessee taxpayers deserve to know where their money is going. Especially during the next recession, when things are tight for all of us. We all know the public sure isn’t getting tax credits and are potentially asked to pay more. Meanwhile, big corporations get to cash in their line of credit of taxpayer dollars, which sadly, is never a shocker.