Trump Tax Break Benefits His Family and Donors, Not the Low-Income Communities It Was Supposed to Help

In North Carolina, Trump is going to try to tout his opportunity zone tax breaks as a benefit to low-income communities. In reality, his administration implemented rules for the program to benefit wealthy investors, including Trump’s family and donors, while providing no guarantees that the tax breaks will actually benefit low-income residents.

The White House modified rules to make a Trump tax law provision more favorable for wealthy investors, without including any rules to ensure it benefitted the low-income communities it was supposed to help.

New York Times: “The Trump administration finished regulations this week that will make it easier for wealthy Americans to invest in and benefit from opportunity zones, a tax incentive created in 2017 that was intended to funnel investment into low-income communities.”

New York Times: “Critics said Treasury’s regulations did not address a fundamental flaw with the zones, which lack legal guidelines to ensure the investments actually benefit low-income areas and residents.”

Some of the biggest beneficiaries of Trump’s opportunity zone tax break have included Trump’s family and advisers.

New York Times: “It is the latest example of the benefits of the Republican tax package flowing disproportionately to the richest of the rich. Even a tax break that was supposed to aid poor communities — an initiative called ‘opportunity zones’ — is being used in part to finance high-end developments in affluent neighborhoods, at times benefiting those with ties to the Trump administration.”

New York Times: “The incentive is benefiting President Trump’s family members and advisers, including the family of Jared Kushner, Mr. Trump’s son-in-law and senior adviser; former Gov. Chris Christie of New Jersey; Richard LeFrak, a New York real estate magnate who is close to the president; and Anthony Scaramucci, a former White House aide.”

Secretary Mnuchin personally intervened to secure an opportunity zone tax break for a longtime friend and wealthy investor.

New York Times: “The institute’s leaders have helped push senior officials in the Trump administration to make the tax incentive more generous, even though it is under fire for being slanted toward the wealthy. Mr. Milken, it turns out, is in a position to personally gain from some of the changes that his institute has urged the Trump administration to enact. In one case, the Treasury secretary, Steven Mnuchin, directly intervened in a way that benefited Mr. Milken, his longtime friend.”

The White House got involved to help a major Trump inaugural donor win a lucrative tax break that won’t meet its intended purpose of spurring new investment in low-income areas.

ProPublica: “After a lobbying effort, Dan Gilbert, billionaire founder of Quicken Loans, won special tax status for wealthy areas of downtown Detroit where he owns billions worth of property.”

Wealthy developers and Republican donors have taken advantage of opportunity zone tax breaks, and the breaks have spurred gentrification while failing to help low-income residents.

Bloomberg: “Once heralded as a novel way to help distressed parts of the U.S., opportunity zones are now being slammed as a government boondoggle. The perks — included in the federal tax overhaul that President Donald Trump signed in late 2017 — are being used to juice potential investment returns in luxury developments from Florida to Oregon. Several reports have shown that politically connected investors influenced the selection of zones to benefit themselves.”

Arizona Republic: “How A Tax Break In Poor Arizona Communities Became A Boon For Wealthy Investors”

WNYC: “The new law has a provision meant to spur investment into underdeveloped areas, called ‘opportunity zones.’ The idea is to grant lucrative tax breaks to encourage new investment in poor areas around the country, carefully selected by each state’s governor. But Port Covington, an ambitious development geared to millennials to feature offices, a hotel, apartments, and shopping, is not in a census tract that is poor.”

Pew Trusts: “Luxury Apartments Get the Tax Breaks Meant to Boost Low-Income Areas”

ProPublica: “A Trump Tax Break To Help The Poor Went To a Rich GOP Donor’s Superyacht Marina.”