Washington, D.C. – In response to the Government Accountability Office’s (GAO) second report on the Opportunity Zone (OZ) tax incentive, John Lettieri, President and CEO of the Economic Innovation Group (EIG), issued the following statement:
“The GAO report sheds important new light on how the Opportunity Zones incentive was implemented and how it is being used to support significant levels of new investment in designated communities. What’s more, GAO confirmed what’s been clear since the beginning: designated census tracts are, on average, high-need communities that reflect the bipartisan intent of the law. Nevertheless, Congress has important unfinished business to ensure the policy lives up to its potential, including enacting thorough reporting requirements that enable better tracking of the policy over time.”
The GAO report includes the following five noteworthy findings:
- The OZ incentive supported roughly $29 billion in new equity investment throughout the country through 2019.
- The 2018 designation process clearly succeeded in targeting high-need communities nationwide.
- States overwhelmingly have a positive or “wait and see” view of the policy, with positive responses outnumbering outright negative by a 20 to 1 margin.
- Firms surveyed indicate that, for the most part, the OZ incentive is driving investment that would not have otherwise occurred within targeted communities.
- The IRS needs to step up its efforts to evaluate and address potential compliance challenges.
Read EIG’s full analysis of the GAO report here.
About the Economic Innovation Group (EIG)
The Economic Innovation Group (EIG) is a bipartisan public policy organization dedicated to forging a more dynamic and inclusive American economy. Headquartered in Washington, DC, EIG produces nationally-recognized research and works with policymakers to develop ideas that empower workers, entrepreneurs, and communities.