The Opportunity Zone industry – POLITICO

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Opportunity Zones are spawning an industry of their own with how-to conferences and other tools for potential investors.

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There’s little appetite for tariffs as corporations on both sides of the Atlantic start weighing in on the Trump administration’s unfair trade practices investigation of France’s digital services tax.

Treasury and the IRS are looking ahead to 2020 with a revised W-4 that is getting finishing touches.

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THE LAND OF OZ: When’s the last time you heard of an entire magazine devoted to a tax code provision? Never? Well, there is one, and it’s an example of the huge interest in the Opportunity Zone program created by the Tax Cuts and Jobs Act, H.R. 1 (115). Another example: HUD Secretary Ben Carson recently traveled to New York to tout the virtues of the zones, which are designed to draw development to struggling areas by offering investors a major capital gains tax break. As our Brian Faler reported from the scene, Carson appeared at a gathering that included would-be developers, investment advisers and deal brokers. “This will be the only thing this country focuses on in the next few years,” Al Puchala, chief executive officer at CapZone Impact Investments, told Brian, with a tad of hyperbole. “I see a massive amount of interest.”

Of course, there’s also a lot of skepticism about the plan in some quarters. Critics say it will be a boon to the rich that will mostly benefit areas that are gentrifying anyway. Indeed, one real estate developer at the New York conference called Hollywood “an awesome opportunity zone.” Others touted zones strategically located next to a convention center and a pro hockey arena. Carson took the skeptics head on, invoking such storied names as Rockefeller and Carnegie. “They said this is just a mechanism for the rich to get richer — um, newsflash, rich people are going to get richer anyway,” he told attendees. “They’re going to invest their money in something. So why not induce them to invest that money into a place that is traditionally economically neglected?”

OPENING ARGUMENTS: Both U.S. and French corporations seem eager to avoid the tariffs President Donald Trump has threatened over France’s digital services tax, or the doubling of U.S. taxes on French interests that others have floated. Instead, both sides continue to push for an international agreement on the issue, according to comments they filed Monday with the Office of the U.S. Trade Representative.

Pro Trade’s Doug Palmer took a look at the filings, which are part of the “Section 301” investigation the USTR opened in July. Gary Sprague, a tax attorney who filed comments on behalf of a coalition of U.S. tech companies including Google, Facebook and Amazon, said, “The French tax is unjustifiable in that it infringes international agreements, and unreasonable in that it is discriminatory, retroactive and inconsistent with international tax policy principles.” However, instead of invoking the type of retaliation the U.S. could unleash if the USTR rules against France, the coalition said “trade officials should ‘encourage France to abstain from unilateral action and redouble efforts aimed at a consensus solution’ in talks at the Organization for Economic Cooperation and Development,” Doug wrote. The Information Technology Industry Council — which includes Amazon and Google — was more blunt, urging USTR to conduct its investigation “without using tariffs as a remedy.”

A group of French corporations similarly urged restraint and an international solution, while avoiding comment on the merits of the tax. It held out hope for a “political agreement” at the G7 summit later this month, followed by a G20 agreement by the end of 2020.

The USTR will hold a hearing in the case Aug. 19

IT’S NEVER TOO SOON: The early peek at the new W-4 seems intended to avert the kind of confusion over withholding that arose in 2018, the first full tax year under the Tax Cuts and Jobs Act. “Treasury and the IRS are releasing this near-final improved Form W-4 now, to allow employers and payroll processors ample time to learn about the new form and update their systems for 2020,” Treasury said in a statement. Though the document is still labeled a draft, “Treasury does not anticipate further changes to the redesign beyond minor updates for inflation,” according to the statement. The final version is scheduled for release late this fall.

The nearly finished form’s unveiling came less than a week after the IRS posted an updated withholding calculator on its webpage. The calculator was a central part of the agency’s effort to make sure Americans withheld enough taxes last year under the TCJA. Reviews of the original calculator were mixed, however. The IRS is urging taxpayers to start using the revised calculator ASAP.

KIWIS GO CRYPTO: New Zealanders will soon be able to get their salaries in cryptocurrency “and be taxed accordingly,” Coindesk reports. The country’s Inland Revenue Department set a start date of Sept. 1. “As far as tax goes, salaries paid in crypto assets will be treated as PAYE (pay as you earn) income payments. These are deducted by the employer and passed onto the tax department,” Coindesk says.

OPIOID COMPANIES GET BREAK: Even as Ohio sues opioid makers and distributors for allegedly fueling addiction there, the companies are major beneficiaries of a state tax break, according to the Columbus Dispatch. A DEA database “shows that while distributors were shipping tax-free drugs out of state, they shipped almost 700 million opioid pills into Ohio from warehouses just across the state line,” the newspaper reported. “To qualify for the tax break, such a center must have at least $500 million worth of products shipped to it in a year and it must ship at least half of those products out of state. Suppliers don’t have to pay Ohio’s 0.26% Commercial Activity Tax on the portion of goods shipped out of state.” Ohio Attorney General Dave Yost told the Dispatch that the state may want to consider adding a provision to the law “to allow the state to exit such an [incentive] agreement upon a showing of behavior of the incentive that creates substantial harm to Ohio.”

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The 1,000-square-mile “exclusion zone” around the ill-fated Chernobyl nuclear plant was expected to be a dead zone for wildlife. But more than 30 years after the disaster, it is home to numerous animals, including bears, wolves, horses and more than 200 bird species.

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