It’s a little unnerving to hear that investors are absolutely racing to capitalize on a new tax law billed as a benefit for poor communities in the United States. Why the unseemly haste? Do investors stampede towards anything except (swords held high) the fatted calf?
But . . . perhaps this would be the moment when the investment community sees an opportunity to generously distribute to the poor what they have reaped from the rich? Has the Robin Hood Era of American Finance finally begun?
Examination of the benefits to business enshrined in a new tax law suggest otherwise. The law adds ‘opportunity funds’ as a new investment vehicle. The potential benefits for investors seem unlimited, tax breaks and tax deferments stretching all the way to tax forgiveness.
As for the poor communities which might soon reap benefits, are there any constraints on the kind of investments that might be made? Projects promoting better access to food? Better facilities such as the internet? More affordable housing?
All apparently allowed. None necessarily required.
Activists are already sounding the alarm that the government, whether with best intentions or otherwise, could simply be gifting investors and developers to destroy affordable neighbourhoods in the interests of gentrification.
Read more in The Gazette: Goldman Sachs leads race for tax break helping poor communities
