Texas to offer Samsung substantial property tax breaks to build $17-bln chip plant

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The city of Taylor, Texas, competes with another city in the state (Austin) to land a $17-billion chip plant Samsung plans to build. Taylor plans to offer the South Korean giant extensive property tax breaks if chosen.

The plant will create about 1,800 new jobs, which other cities want. Samsung has said it is scouting other potential locations in New York and Arizona.

The other potential sites have yet to disclose if they plan to offer the company tax breaks of a similar nature.

Three decades of tax breaks

The city’s website shows that for the land Samsung will use, it will be offered a grant equivalent to 92.5% of assessed property tax for ten years, 90% for the following decade, and 85% in the decade following that.

Additional measures include a 92.5% tax waiver on the new property built on the site for ten years and the repayment of development review costs.

The resolution will be considered by the Taylor City Council and Williamson County Commissioners on Wednesday. The Taylor site sits about 25 miles from Austin. It covers  1,187.5 acres and is much bigger than the Austin site.

Break ground next year

Samsung bought more than 250 acres in Austin last year, which is in addition to 350 acres it owns (where its only US-located chip factory sits).

If Samsung goes with Taylor, it plans to break ground by the first quarter of 2022, with production slated to begin by the end of 2024, according to a document previously filed with Texas state officials.

The move marks yet another multi-billion-dollar effort by a chip-making company to expand capacity in the face of a global chip shortage.