US Senate votes 99-1 to strip AI provision from Trump's tax Bill
Senators voted 99-1 early on Tuesday (Jul 1) to strip the language out of US President Donald Trump's signature tax legislation during a marathon all-night voting session. The overwhelming opposition came despite widespread support for the pause on state AI legislation from GOP allies in Silicon Valley and White House technology advisers Michael Kratsios and David Sacks.
The measure was the top priority for major technology companies including Microsoft and Meta Platforms, as well as venture capital firms like Andreessen Horowitz, which back other powerful players. Trump allies in Silicon Valley, including venture capitalist Marc Andreessen, defence tech firm Anduril Industries founder Palmer Luckey and Palantir Technologies co-founder Joe Lonsdale all advocated for including the restriction.
Senator Marsha Blackburn, whose state of Tennessee is home to the Nashville music industry, led the effort to scrap the provision. She had raised concerns the measure would block her home state's Elvis Act, a law that prohibits the non-consensual use of AI to mimic musicians' voices.
The state AI legislation freeze would have barred states from passing AI legislation if they received broadband funding from a US$500 million federal programme.
Before the vote, Senator Ted Cruz of Texas expressed frustration that a compromise he had brokered with Blackburn to keep a more limited AI measure in the Bill had collapsed. Cruz himself, who championed the state AI regulation pause, ultimately voted to strip it from the Bill.
BT in your inbox
Start and end each day with the latest news stories and analyses delivered straight to your inbox.
Sign Up
Sign Up
Commerce Secretary Howard Lutnick threw his support behind the AI measure, as well, calling it imperative for national security and a step towards quashing blue-state efforts to pass comprehensive AI legislation. Though advocates pushed for Trump to make his own statement supporting the provision in the tax Bill, he ultimately did not weigh in publicly.
States across the country have enacted dozens of new laws intended to Americans against risks posed by AI, such as unauthorised deepfakes, copyright violations and algorithmic discrimination. More than 1,000 AI Bills have been proposed at the state level. At the same time, Congress has yet to pass sweeping regulations.
Opponents of the state AI pause took a victory lap on Tuesday, applauding Blackburn for killing the effort.
'The moratorium threatened to halt kids online safety laws, artist and creator protections, and a range of consumer safeguards and tech transparency measures, all without any federal replacement,' said Brad Carson, president of the AI safety advocacy group Americans for Responsible Innovation. 'Let this be a lesson to Congress – freezing state AI laws without a serious replacement is a political nonstarter.'
Despite the Senate's move, the tech industry will likely continue to push for curtailing state AI legislation. That the provision initially received broad support shows that Republican Party power centres are firmly behind the AI industry's wish for minimal regulatory interference.
Senator Thom Tillis of North Carolina, who on Sunday announced he would retire from the Senate, was the sole lawmaker to support keeping the AI provision in the Bill. BLOOMBERG
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
Straits Times
34 minutes ago
- Straits Times
Trump announces Vietnam trade deal with 20% import tariff
Sign up now: Get ST's newsletters delivered to your inbox Vietnam will also pay a 40 per cent tariff on transshipping, said US President Donald Trump. WASHINGTON - US President Donald Trump said he had reached a trade deal with Vietnam, following weeks of intense diplomacy between the two nations and ahead of a deadline next week that would have seen higher tariffs imposed on the country's imports. 'I just made a Trade Deal with Vietnam. Details to follow,' Mr Trump said in a Truth Social post on July 2 . The deal with Vietnam would be just the third announced following agreements with the UK and China as trading partners race to cut agreements with the US ahead of a July 9 deadline. Mr Trump had imposed a 46 per cent duty on Vietnam as part of his initial rollout of so-called reciprocal tariffs in early April, then pared it back to 10 per cent to allow time for negotiations. The South-east Asian nation has seen its sales to US markets surge in recent years, partly because manufacturers shifted production there from China. It is a major supplier of textiles and sportswear, hosting factories for companies such as Nike Inc, Gap Inc and Lululemon Athletica Inc. Vietnam was the sixth-biggest supplier of US imports in 2024 , sending goods worth almost US$137 billion (S$174 billion), according to Census Bureau data. Top stories Swipe. Select. Stay informed. Singapore Singapore and Cambodia to expand collaboration in renewable energy, carbon markets and agri-trade Singapore From camping to mentorship, Singapore scouts mark 115th anniversary of the youth movement Singapore Ong Beng Seng's court hearing rescheduled one day before he was expected to plead guilty World Sean 'Diddy' Combs convicted on prostitution counts but cleared of more serious charges Singapore ByteDance food poisoning: Catering firm convicted after cockroach infestation found on premises Singapore Teen, 17, to be charged with allegedly trespassing on MRT tracks Singapore Granddaughter of Hin Leong founder O.K. Lim fails to keep 3 insurance policies from creditors' reach Singapore Man on trial for raping drunken woman after offering to drive her and her friend home The deal with Vietnam was struck after weeks of discussions during which the US pressured the country to get tougher on trade fraud, ensure stricter enforcement against the transshipment of Chinese products, and also pushed for the removal of non-tariff barriers. Vietnam offered to remove all tariffs and repeatedly promised to purchase more American goods. Senior Vietnamese officials flew to the US to rally support and sign deals, including for US$3 billion of agricultural goods. The trade minister also wooed executives from Nike, Gap and others to encourage them to get behind negotiation efforts. Brands raced to move manufacturing to Vietnam over the past decade as US-China tensions escalated. The industrial shift from China to Vietnam also helped build the kind of massive trade gap that made it a prime tariff target for Mr Trump. In 2024, Vietnam's trade surplus with the US was the third-largest globally on a country basis behind only China and Mexico. Shipments in May jumped 35 per cent as firms sought to get goods onto vessels as quickly as possible ahead of the deadline. BLOOMBERG
Business Times
37 minutes ago
- Business Times
Trump tax-cut plan returns to US House, Republicans divided on Bill
[WASHINGTON] The debate within President Donald Trump's Republican Party over a massive tax-cut and spending Bill returns to the House of Representatives on Wednesday (Jul 2), as party leaders try to overcome internal divisions and meet a self-imposed Jul 4 deadline. The Senate passed the legislation, which nonpartisan analysts say will add US$3.4 trillion to the nation's debt over the next decade, by the narrowest possible margin on Tuesday after intense debate on the Bill's hefty price tag and substantial cuts to the Medicaid healthcare programme. Similar divides exist in the House, which Republicans control by a 220-212 margin and where a fractious caucus has regularly bucked its leadership in recent years – though members have so far not rejected major Trump priorities. 'The House will work quickly to pass the One Big Beautiful Bill that enacts President Trump's full America First agenda by the Fourth of July,' House Speaker Mike Johnson said in a statement on Tuesday, citing the Bill's extension of Trump's 2017 individual tax cuts and increased funding for the military and immigration enforcement. The House Rules Committee advanced the Senate Bill overnight by a 7-6 vote with two Republicans – hardliners Chip Roy and Ralph Norman – voting against it. Johnson can afford to lose no more than three votes if all members are present, though a series of storms on Tuesday night complicated lawmakers' travel plans, prompting some to drive through the night towards the Capitol. BT in your inbox Start and end each day with the latest news stories and analyses delivered straight to your inbox. Sign Up Sign Up Hardliner anger over spending The loudest Republican objections against the Bill come from party hardliners angry that it does not sufficiently cut spending and includes a US$5 trillion increase in the nation's debt ceiling, which lawmakers must address in the coming months or risk a devastating default on the nation's US$36.2 trillion debt. 'What the Senate did was unconscionable,' Norman, a South Carolina Republican, said on Tuesday. One of several fiscal hawks who spoke out against the Senate Bill's higher price tag, he accused the Senate of handing out 'goodie bags' of spending to satisfy holdouts. Trump for weeks has pushed for passage ahead of Friday's Independence Day holiday and kept up the pressure on Wednesday. 'Republicans, don't let the Radical Left Democrats push you around. We've got all the cards, and we are going to use them,' Trump said in a social media post. Democrats are united in opposition to the Bill, saying that its tax breaks disproportionately benefit the wealthy while cutting services that lower and middle-income Americans rely on. The nonpartisan Congressional Budget Office estimated that almost 12 million people could lose health insurance as a result of the Bill. 'This is the largest assault on American healthcare in history,' Democratic House Minority Leader Hakeem Jeffries told reporters on Tuesday, pledging that his party will use 'all procedural and legislative options' to try to stop – or delay – passage. The version of the Bill passed by the Senate on Tuesday would add more to the debt than the version first passed by the House in May. The CBO on Tuesday raised its estimate for how much the Senate Bill would increase the budget deficit through 2045 by US$100 billion, to US$3.4 trillion. The Bill includes more than US$900 million in cuts to the Medicaid programme for low-income Americans. Those cuts also raised concerns among some House Republicans. 'I will not support a final Bill that eliminates vital funding our hospitals rely on,' Republican Representative David Valadao of California said before Senate passage. Timing difficulties But some House Republicans worried about social safety-net cuts could find solace in the Senate's last-minute decision to set aside more money for rural hospitals, funding Representative Nick Langworthy, a New York Republican, called 'a lifeline that will be very helpful to districts like mine'. Any changes made by the House would require another Senate vote, making it all but impossible to meet the Jul 4 deadline. Any Republican public opposition to the Bill risks irking Trump, as was the case when the president slammed Senator Thom Tillis, a North Carolina Republican who announced his retirement after coming out in opposition to the Bill. Another former Trump ally, the world's richest person Elon Musk, this week resumed an active campaign against the Bill over social media, blasting its deficit-building effects. That has reignited a feud between Trump and Musk. REUTERS
Straits Times
40 minutes ago
- Straits Times
Microsoft laying off several thousand employees
Sign up now: Get ST's newsletters delivered to your inbox The latest job cuts follow a round in May that saw about 6,000 positions culled from Microsoft's global workforce. SAN FRANCISCO - Microsoft on July 2 said it was slashing a little less than 4 per cent of its global workforce as it seeks to cut layers of middle management and leverage new technologies. 'We continue to implement organisational changes necessary to best position the company and teams for success in a dynamic marketplace,' a Microsoft spokesperson said in an e-mail. The cloud computing tech giant did not disclose the total number of lost jobs, but as of June 2024 it employed 228,000 people, bringing the latest layoffs to about 9,000 people. The job cuts follow a round in May that saw about 6,000 positions culled from its global workforce. The company, which is advancing in its plans to deploy AI across all its products, said it was working to 'empower employees to spend more time focusing on meaningful work by leveraging new technologies and capabilities'. 'Even in the best of times, we have regularly adjusted our workforce to meet the strategic demands of the business,' the company added. The company, which celebrates its 50th anniversary this year, was one of the first tech giants to double down on artificial intelligence when the launch of ChatGPT in 2022 rocked the tech industry. AFP Top stories Swipe. Select. Stay informed. Singapore Singapore and Cambodia to expand collaboration in renewable energy, carbon markets and agri-trade Singapore From camping to mentorship, Singapore scouts mark 115th anniversary of the youth movement Singapore Ong Beng Seng's court hearing rescheduled one day before he was expected to plead guilty World Sean 'Diddy' Combs convicted on prostitution counts but cleared of more serious charges Singapore ByteDance food poisoning: Catering firm convicted after cockroach infestation found on premises Singapore Teen, 17, to be charged with allegedly trespassing on MRT tracks Singapore Granddaughter of Hin Leong founder O.K. Lim fails to keep 3 insurance policies from creditors' reach Singapore Man on trial for raping drunken woman after offering to drive her and her friend home
