Coalition Commends President Obama For Supporting Permanent Extension Of New Markets Tax Credit President's FY'14 Budget Would Make Credit Permanent at $5 billion in Allocation Authority
WASHINGTON, April 17, 2013 /PRNewswire/ -- The New Markets Tax Credit (NMTC) Coalition commends President Obama for his call for a permanent extension of the NMTC. By permanently extending the NMTC, President Obama would ensure that low income communities continue to receive billions in capital for new community facilities, businesses and revitalization projects while also generating a significant return on investment to the federal government.
"President Obama should be commended for his support of the NMTC," said Coalition President Jose Villalobos. "A permanent authorization will provide businesses, investors and community development organizations with more certainty as they plan and invest, promoting even greater efficiency with the Credit."
Between 2003 and 2010, NMTC investments were responsible for creating over 500,000 jobs in economically distressed communities across America and generating over $5.3 billion in federal tax revenue, according to a report on the aggregate economic impact of the NMTC released by the Coalition in December. The federal tax revenue generated by NMTC investments more than covers the cost of the program, as measured in terms of revenue lost by the federal government, providing a significant return on investment to the federal government.
Since the NMTC was enacted, it has generated billions of dollars in private investments in projects and communities that likely would never have received such injections of patient capital otherwise. According to a survey conducted by the U.S. Government Accountability Office, 88% of NMTC investors would not have made their investments if not for the incentive of the Credit. More than 71% of these investments went to communities in severe distress, and half went to communities with unemployment rates more than 1.5 times the national average.
The Administration's proposal also provided Alternative Minimum Tax (AMT) relief to NMTC investors. Among the so-called "tax extender" provisions that faced expiration last year, the NMTC was one of the half-dozen the White House supported for permanent extension.
The President's proposal aligns with the NMTC Coalition's comments to the House Ways and Means Committee Tax Reform Working Groups, in which the Coalition urged the Committee to permanently extend the NMTC, provide an increase in credit authority and exempt NMTC investments from the AMT.
SOURCE New Markets Tax Credit Coalition