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Buying Your First House? Why Trump’s Tax Proposal Should Worry You as A Black Person Even More!

15 December 2017 Breaking News, MXO Business Report, Our House No Comment

YourBlackNetwork.net

By Daniel Peterson

Posted December 15th 2017

 

In contrast to the 2016 tax proposal by Hillary Clinton, the recent tax proposal by the Republicans is specifically aimed to hurt the poor Americans.

Blacks —more so, poor African-Americans — are the most likely to be hit the most by these tax proposals. These amendments are likely to increase poverty rates and the wealth disparity gap.

While it sounds nice that the Senate and House plans call for deep reductions to the corporate tax rate (it will increase America’s competitiveness in world markets), other changes are highly concerning.

Affordable housing advocates criticized the House bill for trying to eliminate tax-exempt private-activity bonds which fund many public-private infrastructure projects—including more than fifty percent of the affordable housing units developed under the ‘Low Income Housing Tax Credit Program’ (LIHTC).

Take renting, for instance. Blacks outpace all other races when it comes to household  paying rent for their primary residences.

As of the 3rd quarter 2017, only 42% of black households owned their homes, compared to 72.5 % of the non-Hispanic whites, 46-percent of Hispanics, and 57.1% of all other races, according to the U.S. Census Bureau.

This is troubling when taken together with the fact that in 2016, the average African-American households paid 44% of their take-home incomes in rent.

LIHTC has been loaning to those who want to build their own homes (including blacks)! Therefore, reducing its funding will automatically reduce its financial capability to provide the loans—and also increase rental charges.

Actually, the new move is intending to cause an affordability crisis, because many African-American families will now have to pay even more for housing, and save less to buy their own houses. This will ensure that the Black households remain renters longer.

The ‘Low-Income Housing Tax Credit’ is singularly the country’s chief financier for affordable housing investments. The organization gives credit for the construction of affordable housing for the Americans with low incomes.

Approximately 90 percent of all the affordable housing developments in the United States are partially funded through the ‘Low Income Housing Tax Credit.’

In reality, the Republicans’ tax plan to reduce the funding, will make poor people spend much of their incomes on rent. And that can create a cash crunch which would limit the ability for poor blacks to buy food and other discretionary spending.

This could hurt the economy of the African-American community, creating a sectored economic recession. Such a scenario wouldn’t only worsen the wealth disparity gap but would also endanger the well-being and health of millions.

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