By Dean Parker
In the last two weeks, we have seen frustrated Americans take to the streets to insist that they are allowed to return to work. They have mostly been painted as right-wing anti-government rabble-rousers. When in reality they are honorable men and women whose livelihoods are being threatened.
I applaud the thousands of non-profit and for-profit organizations that have stepped in to help fill in the gap by creating hundreds of COVID-19 relief funds. These charitable funds and sweeping measures such as the Paycheck Protection Program are necessary to help families who through no fault of their own find themselves out of work and facing financial hardship.
The sad truth is that some businesses have shuttered their doors and unfortunately, the Paycheck Protection Program and charitable funds are not enough to save them.
President Trump in his trademark bravado continues to declare that his once roaring economy will return quickly when Americans return to work. We all hope he is right. The communities that will need the most attention are mid-sized cities like my hometown Mobile, AL
Unfortunately, when it comes to attracting huge investments and influx of capital, these communities do not receive the same level of attention as major markets like Los Angeles or New York City.
For the President’s economy to once again soar, mid-sized markets will need to see an influx of capital investment to help turbocharge the economy. The Trump Administration could provide that charge continuing down the path of regulatory reform by repealing IRS NOTICE 2007–55.
With 24/7 coverage of COVID-19, regulatory reform hardly seems to be an important issue. In fact, regulatory reform could be one way President Trump’s strong economy could see a comeback.
When he took office, the President committed to reducing the burdensome red tape of the government. The administration’s deregulation efforts have proven wildly successful resulting in 8.5 rules eliminated for every one new rule created. American households save an estimated $3,100 because of eliminating burdensome regulations.
There are additional regulatory measures the President can take to boost the economy and he can do it on his own authority.
In a letter to Treasury Secretary Steve Mnuchin, Congressman Devin Nunes (R-CA) and key House Republicans have asked that IRS Notice 2007- 55 be withdrawn.
You will not be surprised to learn that like many IRS Notices, Notice 2007- 55 complicates a rather straightforward issue.
The IRS published Notice 2007- 55 in 2007 and threw 30 years of precedent out of the window. The notice basically forced foreign investors in real estate to pay a higher tax than foreign investors in any other asset class. When an international investor liquidates their investment in real estate, they are taxed higher than they are if they liquidate investments in say Walmart, Nike or any other American non real estate enterprise.
A 2017 study by the Rosen Group shares that a full repeal of FIRPTA would increase investments into the U.S. by as much as $125 billion creating desperately needed jobs for low-income and middle-income families. The president on his own authority can get the ball moving by repealing the FIRPTA notice that puts an even greater tax burden on foreign investment in real estate.
We can look to more than theory that FIRPTA reform would work. We have actual proof. Because of loosening restrictions to FIRPTA under the PATH Act in 2015, the nation’s small and mid-sized market saw a spike in investments resulting in more jobs.
Let us not kid ourselves. Full financial recovery from COVID-19 and rebuilding our infrastructure does not happen if private investments do not play a prominent role in the budget. Burdensome regulations like this IRS notice hamstrings communities like mine.
Love him or hate him, President Trump is a shrewd businessman who is truly disturbed by bureaucratic bloat that gets in the way of true economic growth. By repealing the Notice, the president kills three birds with one stone. He eliminates more bureaucratic bloat. He strikes a blow against Democrats whose primary goal is to obstruct his every action. But most importantly, he helps America’s working-class communities by opening more avenues for investment.
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