Abatement is an act to reduce, minimize, suppress or get rid of something altogether, according to Dictionary.com. This term is often used in law and taxes. In real estate, for instance, a tax abatement refers to a legal maneuver to reduce or delay property taxes for home or business owners.
The primary reason a jurisdiction enacts a tax abatement is to encourage new construction in an underdeveloped area. Dictionary.com notes that a tax abatement reduces the home or business owner's obligation relative to typical tax assessments. Many small towns offer a tax abatement to encourage companies to set up shop and employ local workers.