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Project

Economic Development Tax Incentives

States spend billions of dollars a year on tax credits, deductions, and exemptions that are meant to encourage businesses to create or retain jobs and make investments. Pew studies the policies and practices that states have used to generate much-needed analyses about the costs and economic returns of tax incentives. Based on this research, we work with state leaders to:
  • Make a plan to evaluate the results of all major incentives on a regular schedule.
  • Measure the impact of these programs using high-quality evaluations.
  • Inform policy choices with evaluation findings to improve the effectiveness of tax incentives.
State tax incentives
State tax incentives
Report

Improving Tax Incentives for Jobs and Growth

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Report

Tax incentives—including credits, exemptions, and deductions—are one of the primary tools that states use to try to create jobs, attract new businesses, and strengthen their economies. Incentives are also major budget commitments, collectively costing states billions of dollars a year. Given this importance, policymakers across the country increasingly are demanding high-quality information on the results of tax incentives.

State tax incentives
State tax incentives
Article

State Tax Incentive Evaluation Ratings

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Article

Tax incentives—including credits, exemptions, and deductions—are one of the primary tools that states use to try to create jobs, attract new businesses, and strengthen their economies. Incentives are also major budget commitments, collectively costing states billions of dollars a year. Given this importance, policymakers across the country increasingly are demanding high-quality information on the results of tax incentives.

Tax Incentives Report
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State Strategies to Help Businesses Launch and Expand

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State Strategies to Help Businesses Launch and Expand

State governments can undermine opportunities for investment and job creation when businesses spend too much time or money on inefficient regulatory processes, or when new business projects get delayed because firms don’t understand how to comply with the rules. To address this challenge, state policymakers can focus on two types of reforms.

Our Work

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Reducing Budget Risks

Using data and design to make state tax incentives more predictable

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In many cases, the cost of specific state tax incentive programs has increased quickly and unexpectedly by tens or hundreds of millions of dollars. As a result, lawmakers have been forced to make difficult choices between raising taxes and cutting spending to keep budgets balanced.

Economic Development Tax Incentives
Economic Incentives: Measuring Results
3min 13sec