New tax law will spur opportunity in distressed communities
By Sen. Tim Scott
February 14, 2018
I will be at the White House on Wednesday with President Trump, administration officials and community leaders to discuss the Investing In Opportunity Act. The IIOA, which was included in last year’s tax reform package, seeks to direct trillions in capital gains to distressed communities in every state.
Even with the healthier state of our economy and more promising job market, the unfortunate fact remains that there are neighborhoods scattered throughout every one of our 50 states where the hope of achieving the American Dream has all but disappeared.
So the question then is — how do we spread opportunity to every corner of every community across our nation? The solution isn’t nested in another tax-payer funded government program or initiative that fails to get to the root of the problem, but rather public-private partnerships that encourage long-term investment and continued success.
Under the IIOA, in exchange for a lower capital gains rate that decreases based on the length of the investment, investors can put those unused dollars to work in a meaningful and productive way that will grow jobs, inspire entrepreneurship, and improve the local economy.
To make sure the zip codes most in need are the ones that reap the benefits of this new provision, all 50 governors will designate “Opportunity Zones,” meaning governors and local leaders will have the opportunity to identify key qualifying locations that stand to gain the most from this initiative. At the U.S. Conference of Mayors meeting last month local leaders expressed their excitement for this plan, state development offices across the nation are working hard to nominate Opportunity Zones within their area of jurisdiction, and scores of community development groups have already expressed eagerness to find out how they can get involved.
To create a brighter tomorrow for communities that have been left behind, we need to capitalize on the private-sector resources that can help boost these areas in ways we haven’t seen before.