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County looks into tax-cut agreements with businesses

Brian Cuaron

By Brian Cuaron
July 5, 2011 at 2:05 a.m.


The Victoria County Commissioners Court voted to go after permanent tax-cut agreements with local companies.

On Tuesday, the commissioners court authorized the Victoria Economic Development Corp. to pursue pilot agreements with companies regarding the tax on freeport goods.

The county currently charges businesses for freeport goods, or inventory that comes from outside the state and is transported out of the state within 175 days. Yet once the tax is rescinded, it can't be reinstated.

The pilot agreements would require companies to still pay the freeport tax, albeit under a different classification, until the county attracts enough additional tax base to make up for any lost revenue.

"We're just trying to protect you from having a loss of revenue," said VEDC President Dale Fowler, explaining the pilot agreements.

The county has a tax base of freeport goods in the amount of $55 million. It was slated to receive $136,716 from its freeport tax in 2010, according to the VEDC.

The city of Victoria voted last month to cut the tax. However, it only collected about $33,000 from its tax on freeport goods in 2010.

The county has larger companies with larger inventories, Fowler said.

He added that six to eight county-based manufacturers have requested an exemption on freeport goods in the past.

Fowler said that it would take him a few months to put together all the pilot agreements. Afterwards, he will bring that to the court, which can then accept the agreements and rescind the freeport tax.

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