BILOXI, MS (WLOX) - Several businesses in Biloxi have reaped the benefits of a tax abatement. A tax abatement is essentially a tax break. It's designed to attract new business to the city by offering to forgive some of the developers property taxes for a period of time.
But one councilman is calling for a change in the way the city offers these breaks.
From the Hook Up Restaurant to the White House Hotel, several existing businesses and soon to open businesses in Biloxi are taking advantage of tax abatements.
The White House Hotel was given a five year, 100 percent break on some of its property taxes.
And in April, the future Sal and Mookies restaurant was given a five year tax break.
But Councilman Kenny Glavan says Sal and Mookies received what's called graduated tax abatement and that can cause headaches for some.
"One hundred, 90, 80, 70, 60 percent over a five year period that would be an example," Glavan said about the graduated tax abatement. "The tax assessor has said it's difficult to keep up with the staggered percentages and he has requested that the City of Biloxi, if we do so, just make it an average and make it consistent amount over the period of time."
Glavan is calling for a more simplified system. For example, instead of giving a business a 100 percent break the first year and a smaller break each following year they would be granted an 80 percent tax abatement over a five year period and that percentage wouldn't change.
"The other thing we are going to vote on is we're going to bring up Sal and Mookie's, who got a little bit of a less percentage than some of the recent businesses and we're going to bring that up for reconsideration and I think we'll make them the same as we did with some of the other recent businesses."
Glavan says several factors are considered before approving a tax abatement system for a developer's project.
He says city leaders look at things like the amount of jobs the business will create, how much money the business will generate and the project's location.