Local tax incentives are financial benefits offered by local governments to encourage businesses to invest in their communities. These incentives can come in various forms, such as property tax abatements, sales tax exemptions, or income tax credits. By reducing the tax burden, local governments aim to attract new businesses, stimulate economic growth, and create jobs for residents. These incentives can be particularly beneficial for small businesses and startups, as they help lower operating costs and improve cash flow. For example, a local bakery might receive a tax break for opening in a downtown area that needs revitalization. This support not only helps the business thrive but also enhances the overall community.