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SB 1349

Taxation: tax expenditures: Legislative Analyst's Office: assessment, report, and recommendation.

2025-2026 Regular Session Introduced by Mia Bonta and 9 co-sponsors

Requires California's Legislative Analyst's Office to regularly analyze and recommend changes to tax expenditures to improve fiscal transparency and budget accountability.

July 1 set for first hearing. Placed on suspense file.
#legislativeanalyst'soffice #taxation #taxexpenditures #assessment #report #andrecommendation
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Bill Summary · SB 1349

Legislative bill overview

SB 1349 requires the Legislative Analyst's Office (LAO) to conduct comprehensive reports and provide recommendations on California's tax expenditures—the revenue costs of tax breaks, deductions, credits, and exemptions. The bill aims to create a systematic evaluation process for these tax benefits to inform legislative decision-making on fiscal priorities.

Why is this important

Tax expenditures represent significant foregone state revenue (often tens of billions annually) but receive less scrutiny than direct government spending. Without regular analysis, lawmakers lack clear data on which tax breaks deliver intended benefits, prove cost-effective, or could be eliminated to address budget constraints. This bill seeks to bring transparency and evidence-based evaluation to a major but often invisible component of state fiscal policy.

Potential points of contention

  • Administrative burden and cost: Requiring comprehensive LAO analysis of numerous tax provisions will require staffing and resources that could strain the office or delay other legislative priorities
  • Scope and methodology disputes: Disagreement may arise over which tax expenditures to evaluate, how to measure effectiveness, and what constitutes "recommendations" versus overreach into legislative prerogatives
  • Industry opposition: Beneficiaries of current tax breaks (businesses, non-profits, specific industries) may resist systematic evaluation that could lead to elimination or reduction of their tax benefits

Compiled from official sources — confirm details with the bill’s official record.

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