JEFFERSON CITY -- Gov. Jay Nixon asked an advisory group today to give him a comprehensive plan for scaling back state tax credits by Thanksgiving.

Nixon said that while he has chopped state government by $1.2 billion since he took office, spending on tax credits has grown. Tax credits now amount to about 8 percent of revenue collections, up from 5.6 percent four years ago, he said.

"In times like these, everything must be on the table," the governor declared.

The tax credit commission is made up of 25 leaders from business, labor, education and the Legislature. Nixon appointed the group in July. It is co-chaired by developer Steve Stogel of St. Louis and former Sen. Chuck Gross of St. Charles.

Gross said the group would hold five public hearings around the state, then divide into subcommittees to study the 61 tax credit programs.

When the state issues a tax credit, the treasury agrees to forego that amount of money. The recipient gets a voucher, which can be used to reduce income taxes or other business taxes. In most cases, the credits also can be sold for cash to a bank or investor.

The state expects to spend about $500 million on tax credits this year. For example, they fund the clean-up of contaminated sites, entice high-tech businesses to locate in depressed areas, help livestock breeders expand their herds and pay the bills at domestic violence shelters.

The two largest programs are likely to get the most scrutiny. They subsidize the development of low-income housing and the restoration of historic buildings.

Indeed, a coalition that backs low-income housing tax credits is already working to get its side of the story out. It distributed a 2007 study that concluded that the credit generated more than 41,800 jobs over a five-year period.

Whether a tax credit produces a return for taxpayers will be key in the commission's review. Nixon said he wanted "fact-based recommendations for changes we all know are long overdue."

He said that didn't mean gutting economic development. As an example of programs that work, he pointed to the state's $5 million in incentives for a new Sabreliner Corp. hangar in Perryville, Mo.

Most of that money would come from the Quality Jobs program, which rewards firms for creating jobs that pay good wages and provide health benefits.

"This is a far cry from a giveaway or a bail-out," Nixon said. "The state is offering incentives to create lasting jobs, boost economic development and build community."

Other tax credit programs flunk that test, he said.

Some "are going to have to be scaled back," Nixon said. "Some are failing and need to be eliminated."

He said he needed the recommendations by Thanksgiving so that he could craft the next state budget and prepare legislation for the General Assembly to consider in January.