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What to Know: Texas Instruments could soon receive tax breaks worth millions of dollars for expanding an existing facility in Richardson.
“If the company chooses to expand its current Richardson facility, the city would reduce property taxes on the second phase of development within the designated ‘tax abatement reinvestment zone’ at West Renner and Alma roads,” Community Impact Newspaper reports. “The agreement stipulates that property taxes would be abated for Phase 2 business personal property—a category that includes items such as computers, machinery or other movable goods—by 75 percent annually for up to 15 years. The city would also uphold a piece of the original deal that reduces Texas Instrument’s real property taxes—or taxes levied on real estate—by 75 percent annually over a 10-year period.”
The TPPF Take: Companies often demand corporate welfare with the threat of choosing an alternative location if they don’t get tax breaks. But that’s unfair to the other property owners, who have to foot the bill for those breaks.
“When cities, counties and states use tax breaks to lure new companies or retain existing ones, they do so at the expense of existing firms and taxpayers,” says TPPF’s Carine Martinez-Gouhier. “Instead taxes should be low for everyone—businesses and individuals—so that everyone can prosper, which cannot happen when some benefit from tax breaks.”