Tax Incentive Evaluation Law: Maryland

Tax Incentive Evaluation Law: Maryland

This page is no longer being updated. As of June 15, 2017, newer tax incentive evaluation fact sheets are available here.

To ensure that economic development tax incentives are achieving their goals effectively, many states have approved laws requiring regular, rigorous, independent evaluations of these programs. For a list of states that have passed evaluation laws since the start of 2012, click here.


H.B. 764, enacted May 22, 2012

What it does

Requires evaluation of all major tax incentives

For specified tax incentives, nonpartisan legislative staff members identify the programs' goals and assess whether they are being achieved.

For incentives with sunset dates, reviews are timed to take place before the programs' expiration to allow policymakers to use the reports to make decisions.

Connects reviews to policymaking

For each tax credit up for review, legislative leaders appoint an evaluation committee with lawmakers from relevant House and Senate committees.

The evaluation committee holds public hearings to discuss the reports.

The committee is responsible for recommending whether incentives should be continued, modified, or ended.

Excerpt from Maryland’s law: Evaluations focus on whether programs have achieved their goals

The report required under subsection (a) of this section shall discuss:

  1. the purpose for which the tax credit was established;
  2. whether the original intent of the tax credit is still appropriate;
  3. whether the tax credit is meeting its objectives;
  4. whether the purposes of the tax credit could be more efficiently and effectively carried out through alternative methods; and
  5. the costs of providing the tax credit, including the administrative cost to the State and lost revenues to the State and local governments.
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Tax Incentive Programs: Evaluate Today, Improve Tomorrow

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Issue Brief

This report advises states on how to design and implement tax incentive evaluation laws, so that these programs are studied regularly and rigorously and so that lawmakers can use the findings to improve economic development policy.