New rule gradually bringing corporate tax breaks to light

Want to know how much money governments give away in corporate tax breaks? Good luck.

For years, the figure has been incredibly difficult to calculate. That’s because states, cities and other government units haven’t been directed to uniformly report the value attached to the various tax incentives, abatements and financing deals they agree to as a way of stimulating economic growth.

A major accounting shift taking place across the U.S. now is changing things.

The nonprofit Government Accounting Standards Board changed its guidelines beginning in 2016 to require reporting of economic development tax breaks.

For the first time, state, local, county and township governments were instructed to include in their annual reports information on their tax abatement programs. That included how many such deals they had going, the amount of tax revenue foregone and the value of any non-tax commitments, such as land purchases or utility structures, they had agreed to contribute in order to seal the deals.

Watchdog groups praised it as an important precursor to debating whether such incentives are a good investment for taxpayers.

“Before you get to the question of whether they’re getting their money’s worth, you have to know how much is being spent,” said Zach Schiller, director of research for Policy Matters Ohio, a Cleveland-based think tank that tracks government budget issues.

CARLOS OSORIO — THE ASSOCIATED PRESS FILE In this file photo, workers for RBV Contracting Inc., a subcontractor of Cimco Refrigeration Inc., begin excavation for the ice system at Little Caesars Arena, future home of the Detroit Red Wings hockey team and Detroit Pistons basketball team in...