Trump Threatens 35% Japan Tariffs, 'Big Beautiful Bill' Faces Resistance
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Yahoo
34 minutes ago
- Yahoo
Trump ends trade talks with Canada, threatens higher tariffs
President Trump said Friday he was suspending trade talks with Canada and would announce within a week a higher tariff rate on the U.S.'s northern neighbor. In a post on social media, Trump said he was cutting off negotiations with Canada after its government confirmed it would keep in place a digital services tax despite a recent G7 agreement on such levies. 'Based on this egregious Tax, we are hereby terminating ALL discussions on Trade with Canada, effective immediately. We will let Canada know the Tariff that they will be paying to do business with the United States of America within the next seven day period. Thank you for your attention to this matter!,' Trump wrote on Truth Social. Digital services taxes are taxes on tech companies from countries where their products are used. Canada is requiring the first payment of its tech tax on Monday, which will charge 3 percent of revenues above $14.57 million, or 20 million Canadian dollars. House Republicans' domestic agenda bill included a retaliatory measure known as Section 899 specifically to ward off countries from instituting digital taxes against U.S. tech giants. The bill called the taxes 'unfair' and 'discriminatory' and threatened a retaliatory U.S. tax of up to 20 percent on investors from countries with digital services taxes. However, following an agreement with the Group of Seven countries with big economies, Treasury Secretary Scott Bessent called on the Senate on Thursday to remove the U.S. retaliatory tax from their version of the bill. He said that an agreement had been reached that would '[preserve the U.S.] tax base' and that would exempt U.S. companies from a global minimum tax agreement. 'OECD Pillar 2 taxes will not apply to U.S. companies,' Bessent wrote on social media Thursday. Several international business groups representing foreign investors in the U.S. responded positively to the announcement. Canada's big tech tax has been in the works for a while. Some commentators on Friday thought President Trump's social media announcement indicated a lack of planning on the part of the administration, which delivered country-specific tariffs in early April. 'This is a sign the work process on trade from the 2024-2025 presidential transition to April 2nd was horrifically flawed in even more ways than we thought,' Alan Cole of the Tax Foundation wrote on Friday. Getting agreement on how to tax big tech, whose products are used globally but whose headquarters are largely in the U.S., has been the driving force behind different international taxation initiatives in recent years. One initiative has been proceeding at the Organisation for Economic Cooperation and Development (OECD), a group of wealthy countries, and there's another rival framework that's been slowly moving at the United Nations. The OECD framework has two main components, one that's about the location of where taxes are levied and another that puts in place a global minimum tax of 15 percent. The first component is dead in the water while the global minimum tax of 15 percent has been put in place internationally, although the U.S. has not implemented it due to Republican opposition. Republicans did leave the corporate alternative minimum tax (CAMT) negotiated under the Biden administration in place, leaving the domestic U.S. tax structure for international corporate taxation largely consistent with the international framework, multiple sources have told The Hill. 'Pillar 1 is dead, so what we get instead is a set of digital services taxes, and that might increase in number,' University of Michigan tax law professor Reuven Avi-Yonah told The Hill. 'The administration might try to impose tariffs and do other things in order to dissuade more countries from continuing.' Copyright 2025 Nexstar Media, Inc. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.
Yahoo
34 minutes ago
- Yahoo
Trump's big bill could have small economic impact, experts warn
The Senate version of President Trump's domestic policy bill will likely fall short of its ambitious promises for economic growth and fiscal responsibility, economists are warning. While the Senate version will have some substantial differences from the version passed in the House in May, the overall structure of the bill remains in place, with the big pieces of the 2017 Trump tax cuts featuring as the centerpiece. Republicans say the measures will boost growth, create jobs and won't balloon the deficit. The White House released a report Wednesday claiming the bill would boost economic growth by nearly 5 percent and create roughly 7 million jobs over the next four years — far higher than any independent analysis of the bill has found. Trump's 'One Big Beautiful Bill is projected to deliver major economic gains in the first four years,' Treasury Secretary Scott Bessent said in a Wednesday social media post. Economists, investors and tax experts are telling a different story about the bill, tempering their expectations for growth and pointing to the bill's redistributive effects and its deficit expansion, much of which is being swept under the rug using some creative accounting. 'From a macroeconomic perspective, it probably has little effect,' Reuven Avi-Yonah, a professor of tax law at the University of Michigan, told The Hill. 'I'm always a bit skeptical of the growth potential resulting from tax cuts. And it increases the deficit significantly in a higher interest rate environment, and that's not ideal.' Official growth projections for the bill are modest. The Joint Committee on Taxation (JCT), Congress's official tax scorer, predicted the House version of the bill would increase the average annual growth rate of real gross domestic product (GDP) by 0.03 percentage points, from 1.83 to 1.86 percent, through 2034. This is less than growth resulting from the tax cuts when they were first passed in 2017 and measured in 2018. The Congressional Budget Office (CBO), Congress's official legislative scorer, separated out the effects of the tax cuts in 2018 and found them to produce an increase in potential GDP of 0.2 percent, according to the Congressional Research Service (CRS). GDP growth popped in the second quarter of 2018 above 4 percent, which may have been due to demand-side stimulus of the tax cuts. 'The growth effects tend to show a relatively small (if any) first-year effect on the economy,' the CRS concluded in 2018. The current bill includes additional tax cuts geared toward working Americans. As pledged by Trump, the House version canceled taxes on tips and overtime through 2028, though the Senate version institutes caps for those deductions. Tax experts say these provisions will have little to no effect on growth. 'With tax-free tips, all you're doing is encouraging people to earn their income through tips and not wages. You're not creating any new economic activity,' Howard Gleckman, a senior fellow at the Urban-Brookings Tax Policy Center, told The Hill. The House version of the bill would add $2.4 trillion to the deficit over 10 years, according to the CBO. The JCT estimated the Senate's version of the bill would add $440 billion to the deficit. However, that estimate works from the 'current policy baseline,' whereby revenue effects from the extension of the 2017 cuts, which have been in place since 2018, are ignored in the accounting. In other words, Senate Republicans have calculated the total cost of their bill without including the key provisions that would expire without it. With the cost of those tax cut extensions factored in, the true cost of the legislation is between $4 trillion and $5 trillion over 10 years. That's close to 14 percent of the total U.S. debt stock of $36 trillion. 'On a current law basis, we estimate the Senate-proposed tax cuts would increase deficits by $4.2 trillion — nearly $500 billion above the House's equivalent proposals. That figure would rise to $4.8 trillion if temporary tax cuts in the bill were ultimately made permanent,' the nonpartisan Committee for a Responsible Federal Budget found in an analysis. The massive deficit expansion of the bill, which will be subject to increased debt service costs from elevated interest rates, has heads spinning in the financial world. Credit ratings agencies have downgraded U.S. debt levels from their triple-A rating status to the double-A range. Moody's was the last major agency to do so in May. Fitch's downgrade came in 2023 after a congressional standoff over the U.S. debt ceiling and cited an 'erosion of governance.' Different models from the JCT show different effects on capital and investment coming from the House bill. One model delivers an average increase in the U.S. capital stock of 0.3 percent over the 10-year budget window, while another shows a decrease in the capital stock of 0.9 percent that reduces overall economic output. Capital growth improved from 2017 to 2018 but was well within historical ranges, and it's hard to say if it was directly related to the tax cuts. This was true for nonresidential investment, plants, equipment and patents. CRS said in 2019 that they couldn't conclude 'that the higher rate of growth of nonresidential fixed investment was due to the tax changes.' One 2024 study out of UCLA, the Federal Reserve and the JCT found that investment improved slightly in 2018 and then jumped way up in 2019 as a result of the 2017 tax cuts. While the net investment rate declined for pass-through S-corporations, it improved markedly for C-corporations. 'Tax cuts cause increases in sales, profits, investment, employment, and payrolls, with earnings gains concentrated among highly paid workers and executives,' the researchers found. Many of the business tax breaks in the bill — which include permanent R&D credits, bonus depreciation and interest deductibility — have varying degrees of efficacy. Different studies of the R&D credit, for example, have shown that one dollar of the credit stimulated, on average, one dollar of additional intended investment. 'There is widespread agreement that the [R&D] credit could be more effective than it is,' public finance analyst Gary Guenther wrote for the CRS in 2022. Tax experts also think that bonus depreciation is good for capital investment. 'Bonus depreciation may affect investment,' Bradley Borden, a real estate tax specialist at Brooklyn Law School, told The Hill. 'As the activity picked up across 2020 and 2021, people were purchasing property and taking bonus depreciation deductions.' All of the JCT's models of the House bill show the labor supply increasing as a result of legislation, which is the main driver of the bill's modest projected GDP contribution. The CBO agrees, seeing the bill's lower marginal effective tax rates as increasing the incentive to work. The law would boost the labor supply by 0.6 percent and peak at 0.9 percent in 2026 —equivalent to increasing the number of employed people by 1.5 million, according to the CBO. However, numerous analyses suggest that this won't necessarily mean that workers will get paid more, as most of the wage gains from the 2017 bill accrued at the top of the income spectrum. Nominal wage growth was 3.2 percent between 2017 and 2018, but real wage growth, as deflated by GDP, was 1.2 percent, marking a smaller rise than overall compensation growth. This 'indicates that ordinary workers had very little growth in wage rates,' according to CRS. 'Distributional analyses of the tax change suggested that the tax revision favored higher-income taxpayers, in part because most of the tax cut benefited corporations and in part because the individual income tax cut largely went to higher-income individuals,' the agency found in 2019, summarizing previous forecasts. These were confirmed by measurements of the bill's effects. 'Average earnings for workers at the 95th percentile increased by approximately $2,000 per year, while gains for workers below the 90th percentile are statistically indistinguishable from zero,' the study by UCLA's Patrick Kennedy and others concluded. Just as wage and salary gains from the bill are likely to amass at the top, according to projections, the bill is also expected to redistribute wealth and resources toward the upper echelons of the income spectrum. While the bill doesn't expressly increase taxes on the poor, it does shift wealth away from them, with the lowest tenth of earners losing resources and the top tenth gaining them. Gains from the bill are increasingly skewed toward the rich, according to the CBO. The highest tenth of earners will get an additional $12,000 per year, while the second-highest tenth will get about $3,200, the third tenth will get about $2,100, and the fourth tenth will get about $1,500. The trend continues down the line. The seventh-highest tenth won't see much of a change in their annual wealth, while the bottom three deciles will be worse off. Copyright 2025 Nexstar Media, Inc. All rights reserved. This material may not be published, broadcast, rewritten, or redistributed.
Yahoo
35 minutes ago
- Yahoo
Are we getting a stimulus check in July 2025? How to track my stimulus check status update
Taxpayers are waiting on tax refunds and the possibility of a stimulus check in 2025 from President Donald Trump or the Internal Revenue Service. Here's what to know about the second, third and fourth stimulus checks, amounts, eligibility and an update on their status. The first stimulus check was for up to $1,200 for individuals and $2,400 for married couples, plus $500 per qualifying child under the age of 17. While the second check was up to $600 per individual, $1,200 for married couples and $600 per qualifying child under 17. The third stimulus check was for $1,400 per eligible individual and married couples filing jointly received an additional $1,400 for each qualifying dependent. The opportunities to claim or file for the first stimulus payment (issued in March and April 2020) or the second stimulus check (issued by Jan. 15, 2021) or the third stimulus check (issued between March and December 2021) have now passed. The deadline to file for the third and laste stimulus check was April 15, 2025; it marked a three-year deadline to claim any tax refunds or in this case, the $1,400 Recovery Rebate Credit for 2021. It is best to work directly with the Internal Revenue Service (IRS) or a reputable tax professional to address missing stimulus payments or claim the relevant Recovery Rebate Credit on your tax return, if eligible. Even if you received a tax extension, you still needed to file your 2021 tax return by the April 15, 2025 deadline to claim that third stimulus check. There are no extensions or appeals available for missed deadlines, and any unclaimed stimulus payments become the property of the U.S. Treasury. While speculation about a fourth stimulus check of $2,000 has surfaced on social media and unverified websites, there has been no official confirmation from Congress or the IRS to support this claim and any such news should be taken with caution as it could be misinformation or attempted fraud. In February, Trump said he would consider the plan to pay out $5,000 stimulus checks to taxpayers in the form of a 'DOGE dividend' during a summit in Miami. He explained it as using part of the 20% of the savings identified by Musk's Department of Government Efficiency (DOGE) and giving it back to taxpayers. However, he has not shared any further specifics or details about the possible 'DOGE dividend' or its certainty since then. Here's what to know about tracking your tax refund and when to expect it. If you filed your federal taxes electronically and included your banking information, then you may expect a direct deposit within 21 days. If you did not include banking information, then you may expect a paper check refund via the mail within six to eight weeks. Submitting your return is not the same as the IRS accepting your return. Once it is accepted, you will know it has if you see a "Refund Sent" alert when you check your tax return status online, at which point you won't have to wait too long for the funds to show up in your account. Once the IRS approves your refund, it could hit your bank account within days via the direct deposit option. The IRS has an online tool called "Where's My Refund" that allows you to check on the status of your refund. Click here. You can start checking the status of your refund within 24 hours after you e-filed your return. The refund information is updated on the IRS website once a day, overnight. The online tool requires you to enter your Social Security number, filing status and exact refund amount on the return. It will then respond with a return received (processing), refund approved (preparing to issue refund by date shown) or refund sent (send to your bank or in the mail). Again, once it shows the IRS has approved your refund, it could hit your bank account within days via the direct deposit option. The other way to check on the status is to call the IRS at 800-829-1954. If your taxes were electronically filed and accepted by April 15, it is estimated that you should have received a direct deposit federal refund from the IRS by May 6 or June 16th by mail. Most states have dedicated online portals for tracking income tax returns. The Delaware Division of Taxation has established an online portal you can access to check the status of your state refund. To check on Pennsylvania online portal for state tax refund, click here. To check on New Jersey online portal for state tax refund, click here. Maria Francis is a Pennsylvania-based journalist with the Mid-Atlantic Connect Team. This article originally appeared on Are we getting a stimulus check in July 2025? Where's my refund?
