Tesla is poised to receive a massive tax break of up to $360 million for its expansion of Giga Nevada, the company’s lithium-ion battery factory. The incentives include exemptions from paying payroll and property taxes for the next ten years, as well as reduced sales taxes for the next 20 years.
The company will also receive $81.4 million in tax reimbursements over the next two decades, as part of a potential agreement with Storey County, where the facility is located. The tax abatement is intended to create 3,000 new jobs and keep Tesla in the area. However, the plan still needs to be voted on by a state board, which includes Governor Joe Lombardo and members of the private sector.
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Critics have raised concerns over the short timeframe between the release of the abatement package details and the vote. Some have criticized Tesla’s use of a nondisclosure agreement (NDA) to keep the details private, arguing that NDAs should not protect large corporations and prevent transparency.
Senator Dina Neal also expressed concerns that there may not be adequate time to assess the potential impact of the abatement on other vital government services in the region, such as housing supply, public schools, and safety.
Tesla has a history of receiving incentives. In 2014, the company received nearly $1.3 billion in incentives, spread over 20 years, for the first round of abatements. Storey County Manager Austin Osborne believes that these incentives had a positive impact on the region, providing jobs and significant regional fiscal impacts.
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Tesla’s expansion of Giga Nevada comes as the company plans to invest an additional $3.6 billion into the plant to expand Semi production. Tesla Semi, the company’s electric semi-truck, started deliveries in December with Frito-Lay and parent company PepsiCo. With the new incentives, Tesla hopes to continue its growth and innovation in the region.
