SpaceX and Tesla Inc. (NASDAQ:TSLA) CEO Elon Musk on Wednesday said the EV giant’s Terafab chip fabrication facility in Grimes County, Texas, would become the county’s largest source of revenue.

Terafab To Account For 25% Tax Revenue

In a response to influencer Sawyer Merritt, who posted about the Terafab facility getting tax breaks in the form of no property taxes for the facility from the County.

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Musk said that if the location works out, “SpaceX will still be paying an annual amount” to the County that would increase its tax revenue by 25%, adding that the amount would be “the biggest source of revenue for the county.”

The billionaire then noted that, when accounting for the taxes paid by SpaceX employees and contractors to the County, “Terafab will far exceed ALL revenue that Grimes County currently earns!”

Musk then expanded on why SpaceX asked for property tax breaks, which he said was “standard practice” for investments of that magnitude.

“Terafab will have a large number of extremely expensive machines for making chips,” Musk said, adding that property taxes on the machines would put the company “at a serious competitive disadvantage” compared to other fabs.

SpaceX IPO, Tesla Merger Talks

SpaceX, in filings with the Securities and Exchange Commission (SEC), said that the company would be selling more than 555 million shares of the commercial space flight giant at $135/share. The company would also be targeting raising over $75 billion via the listing.

Meanwhile, talks of a possible merger between Tesla and SpaceX have been in the headlines, with investors like Dan Ives of Wedbush Securities being bullish on such an event. Ives predicted that there was an 80% chance the merger happens next year.

However, a merger between the two enterprises could also result in Musk's $1 trillion CEO pay package automatically kicking into effect without the EV giant meeting the stipulated milestones in the package, according to the contract terms of the award.

Benzinga Edge Rankings show Tesla offering a favorable price trend in the Short, Medium and Long term. TSLA shares also provide excellent Growth and Quality.

Price Action: TSLA was down 0.84% to $420.16 during the after-hours trading session on Wednesday.

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