Tax-exempt private activity bonds (PABs) are commonly used for the construction of affordable multifamily housing, hospitals, and infrastructure projects. The House GOP's tax proposal eliminates the bond.
"Low-income housing needs some sort of government assistance. It is simply uneconomic to do this without a subsidy," said Rick Goldstein, tax attorney and counsel to the Affordable Housing Tax Credit Coalition to CNBC, "It's a devastating reduction if you cut that type of financing from the few programs that really exist out there to help people, to help the government help our communities build affordable rental housing."
While PABs are cut in the House bill, they are not touched in the Senate tax plan, and lawmakers on both sides of the aisle are now embroiled in a bond battle ... Eliminating the program would save the government $38.9 billion over 10 years, according to an estimate by Congress' Joint Committee on Taxation. The entire package would create a more than $1 trillion deficit.
