Latest news with #OBBBAct
Yahoo
03-07-2025
- Business
- Yahoo
US retail, cotton sectors back amendment to One Big Beautiful Bill
The National Cotton Council (NCC) has expressed strong support for the recent Senate passage of the One Big Beautiful Bill (OBBB) Act, a pivotal piece of legislation aimed at reinforcing the agricultural safety net. The OBBB Act is a proposed budget reconciliation bill in the 119th United States Congress proposed by President Donald Trump. It seeks to restore America's economic strength and reward its hardworking citizens. The bill aims to protect family farmers by preventing punitive double taxation from hitting two million family farms. It raises death tax exemption, increasing the amount family farms can inherit without paying taxes. NCC chairman Patrick Johnson said: "The NCC appreciates the momentous effort that has gone into crafting and passing the One Big Beautiful Bill. "We are grateful for the Senate's commitment to delivering meaningful enhancements to the cotton safety net, which is absolutely critical for the stability and future of our industry." Several American companies across industries are supporting the OBBB act, recognising it as a bold step toward revitalising the US economy. The companies, from manufacturing giants and tech leaders to energy and retail powerhouses, see the bill as a catalyst for job creation, domestic investment, and long-term growth. The budget reconciliation bill contains a provision to permanently end the 'de minimis' threshold for commercial imports from all nations by 2027. Last week The National Retail Federation voiced strong support for the Senate Amendment to the Act calling it a "pro-growth, pro-consumer package that will boost take-home pay, fuel economic expansion and support retail businesses and the communities they serve." 'This legislation delivers meaningful tax relief to working families, ensures the permanence of pro-growth tax policies, and preserves the low corporate and small business tax rates that have helped drive record investment and hiring," said NRF CEO, Matthew Shay. "We urge Congress to move quickly to send this bill to the president's desk.' "US retail, cotton sectors back amendment to One Big Beautiful Bill" was originally created and published by Just Style, a GlobalData owned brand. The information on this site has been included in good faith for general informational purposes only. It is not intended to amount to advice on which you should rely, and we give no representation, warranty or guarantee, whether express or implied as to its accuracy or completeness. You must obtain professional or specialist advice before taking, or refraining from, any action on the basis of the content on our site. Sign in to access your portfolio
Indian Express
26-05-2025
- Business
- Indian Express
Donald Trump's One Big Beautiful Bill
Last week, the US House of Representatives passed what President Donald Trump calls his 'one big beautiful Bill'; it is officially titled the One Big Beautiful Bill Act of 2025 (OBBBA) and is over a thousand pages long. The focus now shifts to the US Senate, the other house in the US Congress, to deliberate on the Bill. Once both the houses of Congress agree on the Bill — it may go back and forth between the two houses before all issues are reconciled — and pass it, it will be sent to the US President for approval to become the law of the land. However, the passage of the Bill has raised concerns that have significant ramifications both for the health of the US economy and the electoral prospects of the Republican Party, which currently dominates both the federal executive and the legislature. Why is the Bill 'big and beautiful'? President Donald Trump won his second term based on certain key promises. Some of these — such as imposing tariffs on imports from different countries — could be initiated through executive actions. But many others required legislative changes, which is the exclusive preserve of the US Congress (comprising the House of Representatives and the Senate). The OBBB Act essentially encapsulates Trump's policy agenda and campaign promises in 'one big, beautiful' legislative document. There are five key aspects of the OBBB. * The first element is that it extends and makes permanent the cuts to income tax and estate tax that Trump brought in 2017 during his first term. * The second refers to the new tax cuts on things such as overtime, tips, and social security incomes. Overall, the White House claims, 'Americans making between $30,000 and $80,000 per year will see their taxes cut by 15% next year'. * The third big element is spending more on border security (to prevent illegal immigration) and towards the improvement of US military and defence capabilities. * The fourth element is to cut down on 'waste, fraud and abuse' in government spending. * The fifth element is to raise the so-called 'debt ceiling'. The debt ceiling is essentially the limit on how much the US government can borrow. Since the amount to be borrowed has been going up over the years, the US Congress has to, from time to time, formally raise the debt ceiling. Without the debt ceiling being raised, the US government will not be able to pay its bills. What is not so beautiful about the Bill? Overall, there are two broad sets of concerns that have been highlighted by economists and members of US Congress, including several Republicans like Josh Hawley (Senator from Missouri). The first is about the adverse fiscal (having to do with the government budget) impact of OBBB and its macroeconomic implications. While the OBBB is essentially a policy document, each element has its own specific implication for the US Federal budget. As such, tax cuts on the one hand and spending increases on the other have the effect of worsening US government finances. As CHART 1 alongside shows, the US Federal deficit — the gap between what the government spends and what it earns — is already quite high. As of 2024, such borrowings stood at around 6.4% of US GDP, more than double the level that many believe is acceptable. For perspective, that level of federal deficit translates to $1.9 trillion, which is roughly 50% of India's total GDP in 2024. The OBBB is expected to increase federal deficits further and add to the already growing pile of US debt. Each year's deficit adds to the overall debt. As CHART 2 shows, debt to GDP ratio has been rising fast and has already touched the 120% level. At the going rate, many expect it to rise to 200% in the coming decade. Policy experts, including the US Federal Reserve Chair Jay Powell, say that the trends of US deficit and debt (as proportions of GDP) are unsustainable. It is for this reason that global investors are increasingly wary of lending fresh money to the US government. This shows in the US government's falling credit ratings as well as rising bond yields. For instance, on May 17, even before this Bill was passed, Moody's stripped US government debt of its triple A rating. It is for the first time in US history that none of the top three credit rating agencies — Fitch and S&P are the other two — rate US government debt as top notch. Moody's estimates that at the going rate, federal deficits could grow to 9% of US GDP by 2035. As investors pull away from buying US dollar denominated bonds, their prices fall and their yields rise; a trend that is being witnessed at present. Higher yields imply the US government will have to pay a higher interest rate for its borrowings. To be sure, when the market charges higher interest rates for lending money to the US government — which is the most risk-free debt one can extend — the interest rates for everyone (US citizens and US businesses alike) go up in a commensurate manner. The second concern is about the redistributive aspects of the OBBB. Economist Justin Wolfers of University of Michigan has called the Bill 'anti-Robin Hood' for how it transfers the wealth from the American poor to the American rich. It does so by giving tax cuts to the rich while limiting government help to the poor. An analysis of the OBBB by the Congressional Budget Office (CBO), which provides 'objective, nonpartisan information' and helps the Congress make effective budget and economic policy, finds that even though overall this Bill will provide US families with more resources over the next decade, the benefits will not be evenly distributed. 'CBO estimates that household resources would decrease by an amount equal to about 2 percent of income in the lowest decile (tenth) of the income distribution in 2027 and 4 percent in 2033, mainly as a result of losses of in-kind transfers, such as Medicaid (health insurance) and SNAP (Supplemental Nutrition Assistance Program). By contrast, resources would increase by an amount equal to 4 percent for households in the highest decile in 2027 and 2 percent in 2033, mainly because of reductions in the taxes they owe,' it states. Udit Misra is Deputy Associate Editor. Follow him on Twitter @ieuditmisra ... Read More
