Politics

White House: Trump Opportunity Zones Raised $75b To Rebuild Poorest Communities

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The Trump administration’s tax break for underprivileged neighborhoods has attracted an estimated $75 billion dollars in private investment, potentially lifting 1 million people out of poverty, according to a White House study.

Opportunity zones were created in the tax overhaul of 2017, offering capital gains advantages to investors as a way to encourage new businesses, housing, and jobs.

President Trump has hailed their success. But critics say the biggest beneficiaries are billionaire financiers and warn that a small number of the most attractive zones are attracting the bulk of the money.

A study by the White House Council of Economic Advisers, obtained by the Washington Examiner and due to be published on Monday, estimates that $75 billion has been raised by funds set up to invest in the zones — money that would likely have been directed elsewhere without the breaks.

“The CEA estimates that opportunity zone designation alone has caused a 1.1 percent increase in housing values,” it says. “Greater amenities and economic opportunity behind the housing value increase will be broadly enjoyed, and for the nearly half of OZ residents who own their homes, the increase provides an estimated $11 billion in new wealth.”

The program allows investors to defer and lower their capital gains taxes on sales of stocks and other investments if they plow the proceeds into projects in areas struggling with poverty. Nearly 8,800 opportunity zones have been certified.

Early supporters include Anthony Scaramucci, a member of Trump’s campaign finance committee in 2016 who served briefly as White House director of communications, as well as the president’s son-in-law, Jared Kushner. Scaramucci’s Skybridge Capital runs an opportunity zone fund, while Kushner sold his stake in a company investing in opportunity zone projects amid allegations of a conflict of interest.

But the zones are a key plank of Trump’s reelection pitch to African American and Hispanic voters. He cited them on Friday during a speech to the Council for National Policy as an example of the work he has done for ethnic minorities.

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