Under new accounting rules proposed by GASB, state and local government financial statements would be required to reflect agreements that they make to attract businesses to their area.
The proposed disclosures would require disclosures about tax abatements to include:
- General descriptive information such as the tax being abated, criteria for eligibility for abatement, provisions for capturing abated taxes and types of commitments made by the abatement recipients
- The government’s number of abatement agreements
- The dollar amount of taxes abated
- Other commitments made by a government in the agreements, such as commitments to build infrastructure assets
VACo Contact: Vicky Steinruck