Financial Facts

October 2, 2015

FinancialFacts15

The Government Accounting Standards Board has issued GASB Statement No. 77 effective for financial statements for periods beginning after December 15, 2015. GASB No. 77 requires new government disclosures for both state and local governments to disclose businesses given tax incentives and tax breaks.

The new disclosures about a government’s own tax abatement agreements include:

• The purpose of the tax abatement program
• The tax being abated
• The dollar amount of taxes abated
• Provisions for recapturing abated taxes
• The types of commitments made by tax abatement recipients
• Other commitments made by a government in tax abatement agreements, such as to build infrastructure assets

The new standard also requires disclosures about tax abatements that are entered into by other governments that reduce the reporting government’s tax revenues, to include:

• The name of the government entering into the abatement agreement
• The tax being abated
• The dollar amount of the reporting government’s taxes being abated

VACo Contact: Vicky Steinruck

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