Musk defends Tesla as Texas county considers millions in tax breaks to land 'gigafactory'

By Daniella Genovese FOXBusiness

Critics argue the tax breaks would come ‘at the expense of children’s education’

Elon Musk is defending his electric car company, Tesla, saying it “receives the least subsidies of any automaker” after some criticized a proposed multimillion-dollar tax break for the company to build a factory in Austin, Texas.

“Federal tax credit applies to other EVs, but no longer Tesla,” Musk tweeted.

Musk’s comments came after some Texans raised concerns at a public hearing last week regarding a school district’s proposal that would offer Tesla tens of millions in property tax breaks over the next decade as an incentive for the company to build a potential $1 billion “gigafactory” in Travis County.

TESLA EYEING SIGNIFICANT TAX BREAKS AS IT CONSIDERS TEXAS PLANT

Austin, alongside Tulsa, Oklahoma, is in the running for the automaker’s new U.S. assembly plant, which will manufacture its Cybertruck and Tesla Model Y.

The electric-car maker has said it wants the factory to be in the center of the country and closer to East Coast markets. However, the stakes are high for state and local governments that covet auto factories because they have a lot of workers and normally pay well, generating income and property taxes.

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The Del Valle Independent School District proposal was made public in a Tesla tax application filed earlier this month with the Texas comptroller’s office. Travis County commissioners are considering a separate tax incentive package.

Overall, the proposal would offer Tesla $68 million in property tax breaks over the next decade to build a new plant off Texas 130 just north of the Colorado River on the southeastern outskirts of Austin.

TESLA IN TALKS WITH TEXAS COUNTY FOR NEW ASSEMBLY PLANT: REPORT

The comptroller’s documents state the real value of the property would average about $600 million per year. Without the Del Valle district incentives package, Tesla would have to pay almost $8 million in property taxes per year.

However, the offer drew pause from some residents who say that asking a school district to “hand over millions” during the coronavirus pandemic “is simply ridiculous,” according to the Statesman.

Others expressed that the local tax breaks would come “at the expense of children’s education,” the outlet reported.

The concerns, however, were countered by other residents who said the added jobs would stimulate economic development in the area, which is considered underserved and has a large minority population, according to the outlet.

The proposed plant would have 4 million to 5 million square feet of space and would be Tesla’s biggest so far. The company has previously touted that the factory would not only open up 5,000 “middle-skill” jobs at the factory but it would also spur the creation of 4,000 additional jobs in the area, The Verge reported.

If Austin was chosen, the plant would span thousands of acres on the gravel and grass area owned and operated by Martin Marietta, according to the Statesman. The Martin Marietta plant would then be relocated.

Tesla has not announced when it will make its final decision.

The Associated Press contributed to this report. 

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