Any control unit, with the exception of a school district responsible for real estate, may grant a discount. If real estate is: Responsibility and results Local governments justify tax breaks on the grounds that reduced taxes are not lost income, because the money would not have been in the city`s coffers if the development had not taken place. While this is true in some cases, it is all too common for businesses that do not really need them to benefit from property tax cuts, which deprives the city of the income it would have had without the subsidy. Yes, yes. If the landowner does not make the agreed improvements, the control unit can take back the tax that was evaded by the reduction. If the agreement contains the necessary provision, a tax unit may also recover taxes if the owner of the property does not create new jobs or fulfill another provision of the agreement. Yes, yes. Each time before the reduction expires, the local government can change the terms of the contract, transfer them to a new owner of the property or terminate the contract entirely. Yes, yes. Any assessment area with a reinvestment area for tax breaks or denied real estate must submit reports on the area and mitigation agreements to the Texas Comptroller of Public Accounts.
Property tax reductions are generally granted by local governments (urban and departmental), where the lion`s share of property taxes is paid. Property tax reductions are often discretionary grants to a particular company on a case-by-case basis. They are also sometimes offered as subsidies, as in many business areas. Suppose a city decides to enact a tax reduction agreement for a particular property in order to encourage a large non-urban developer to buy and develop the property. Beforehand, the city must have opted for tax cuts and comply with existing tax breaks. The agreement with the promoter could look like this: 90% reduction of the new taxable value in the first year, 80% in the second year, 70% in the third year, and so on until the property is taxed at full value in year 10 of the agreement.