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About: Development Impact Tax     Goto   Sponge   NotDistinct   Permalink

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A development impact tax taxes new construction. Such taxes are commonly used to pay for the infrastructure needed to support the public strain of new development. New commercial development can require additional infrastructure or other public services that require tax money; however, impact taxes usually apply to residential development. Whenever many houses are built and many people move into an area tax money is spent. In order to support the increased population new schools need to be built as well as libraries, hospitals, water treatment, etc.