Tax breaks are a particularly invidious type of corporate welfare, because they rarely carry with them any mechanism for accountability for how they are used and what public benefit is provided. They are largely invisible, and seldom noticed. In addition, unlike a direct expenditure, a tax break does not need to be reenacted or reviewed, and typically remains on the books unless a sunset clause is attached specifying an expiration date. There are dozens of different ways that corporations receive tax breaks, including deductions in sales and use taxes, credits on insurance premium taxes and others. Many businesses or industries also receive property tax relief through rate reductions.
Most development raises the value of the land that is developed.
This increase in value would normally result in an increase in property taxes. Tax Increment Financing allows a percentage of these increased taxes to be kept to cover a portion of the developer s costs. Tax Increment Financing has been used by many cities to subsidize development projects. Federal Grants and Loans , including Community Development Block Grants and Section 108 Loan Guantees can also provide cash to businesses for locating, expanding or hiring in economically depressed communities. Some of these programs may include language regarding job creation and even job targeting to low income communities.