Dive Brief:
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Restrictions on policies that currently allow deferments of investment-property capital-gains taxes, elimination of certain interest deductions of state and local real estate tax deductions, and changes to Tax Increment Financing Districts are part of the proposed Tax Reform Act of 2014 now being considered by Congress. Changes could hamper retail real estate investment, according to some members of Congress who spoke at a May 18 gathering sponsored by the Council of Shopping Centers.
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The proposals are part of an effort to simplify the tax code and some provisions of the Tax Reform Act of 1986.
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The proposed changes could become part of the Marketplace Fairness Act, which would require state tax collection by online retailers, or the Internet Tax Freedom Act due to expire in October, which outlaws taxes on email and bandwidth.
Dive Insight:
Three Congressmen, who were all once mayors and perhaps more aware about the impact of real estate investment incentives, spoke to a gathering sponsored by the International Council of Shopping Centers and urged retailers to talk to their members of Congress about some of the proposed tax changes now before Congress. Certainly, negative impacts from changes to tax incentives for retail development could add to the challenges faced by retailers' brick-and-motar stores.