IDEAS home Printed from https://ideas.repec.org/a/jns/jbstat/v242y2022i5-6p609-628n8.html
   My bibliography  Save this article

Evolution of the New Market Tax Credit

Author

Listed:
  • White A. Quinton

    (U.S. Department of the Treasury, Washington, D.C., USA)

Abstract

The New Market Tax Credit (NMTC) is a place-based policy in the United States which annually incentivizes billions in direct investments towards selected impoverished communities. I document how project characteristics and NMTC claimants have changed over the lifetime of the policy. The share of real estate projects has declined by over 30 percentage points and the share of projects in metropolitan areas has declined by over 20 percentage points. Although available to both corporate and individuals tax filers, the NMTC is primarily claimed by corporate filers. NMTC claimants have higher levels of income and assets than the average taxpayer. By 2018, the NMTC is over 45% of all general business credits for NMTC claimants. I also quantify how economic conditions are correlated with the probability and amount of NMTC investment a tract receives. Cross-sectional comparisons within states indicate tracts with greater poverty rates are correlated with a higher likelihood of receiving NMTC investment and receiving more investment. However, comparisons within tracts across time are inconclusive.

Suggested Citation

  • White A. Quinton, 2022. "Evolution of the New Market Tax Credit," Journal of Economics and Statistics (Jahrbuecher fuer Nationaloekonomie und Statistik), De Gruyter, vol. 242(5-6), pages 609-628, December.
  • Handle: RePEc:jns:jbstat:v:242:y:2022:i:5-6:p:609-628:n:8
    DOI: 10.1515/jbnst-2022-0003
    as

    Download full text from publisher

    File URL: https://doi.org/10.1515/jbnst-2022-0003
    Download Restriction: no

    File URL: https://libkey.io/10.1515/jbnst-2022-0003?utm_source=ideas
    LibKey link: if access is restricted and if your library uses this service, LibKey will redirect you to where you can use your library subscription to access this item
    ---><---

    More about this item

    Keywords

    tax credits; place-based policy; new market tax credit; business tax;
    All these keywords.

    JEL classification:

    • H20 - Public Economics - - Taxation, Subsidies, and Revenue - - - General
    • H25 - Public Economics - - Taxation, Subsidies, and Revenue - - - Business Taxes and Subsidies
    • R12 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - General Regional Economics - - - Size and Spatial Distributions of Regional Economic Activity; Interregional Trade (economic geography)
    • R38 - Urban, Rural, Regional, Real Estate, and Transportation Economics - - Real Estate Markets, Spatial Production Analysis, and Firm Location - - - Government Policy
    • G18 - Financial Economics - - General Financial Markets - - - Government Policy and Regulation

    Statistics

    Access and download statistics

    Corrections

    All material on this site has been provided by the respective publishers and authors. You can help correct errors and omissions. When requesting a correction, please mention this item's handle: RePEc:jns:jbstat:v:242:y:2022:i:5-6:p:609-628:n:8. See general information about how to correct material in RePEc.

    If you have authored this item and are not yet registered with RePEc, we encourage you to do it here. This allows to link your profile to this item. It also allows you to accept potential citations to this item that we are uncertain about.

    We have no bibliographic references for this item. You can help adding them by using this form .

    If you know of missing items citing this one, you can help us creating those links by adding the relevant references in the same way as above, for each refering item. If you are a registered author of this item, you may also want to check the "citations" tab in your RePEc Author Service profile, as there may be some citations waiting for confirmation.

    For technical questions regarding this item, or to correct its authors, title, abstract, bibliographic or download information, contact: Peter Golla (email available below). General contact details of provider: https://www.degruyter.com .

    Please note that corrections may take a couple of weeks to filter through the various RePEc services.

    IDEAS is a RePEc service. RePEc uses bibliographic data supplied by the respective publishers.