Latest news with #federalprograms
Yahoo
6 days ago
- Automotive
- Yahoo
Prediction: Tesla Might Lose This $2.76 Billion Revenue Source That Is Nearly 100% Profit
Tesla will soon lose a critical profit source. This loss will make exciting growth opportunities more difficult to pursue. These 10 stocks could mint the next wave of millionaires › The future of Tesla (NASDAQ: TSLA) appears very bright. Some experts believe the company's new robotaxi service could add more than $1 trillion in value by the end of 2026. But there's one challenge few investors are paying attention to. This challenge could swiftly eliminate one of Tesla's most profitable revenue sources. In recent years, nearly every electric car stock has benefited from automotive regulatory credits. These credits are earned under both state and federal programs, in both the U.S. and abroad. While each program differs in specifics, these credits are generally earned when a company sells low-emissions vehicles. These companies can then sell these credits to automakers that do not sell enough low-emission vehicles. For example, Stellantis bought roughly $2.4 billion of European and U.S. regulatory credits from Tesla between 2019 and 2021. The idea behind these credits is to encourage investment in and production of climate-friendly transportation options. That is, these credits are designed specifically to spur adoption of things like electric vehicles (EVs). Over the years, these credits have certainly helped keep EV makers like Tesla, Rivian, and Lucid Group financially viable. Rivian recently generated the first positive gross margins in its history, largely thanks to the sale of these credits. Besides a bit of overhead, the sale of these credits results in nearly 100% profit margins -- a huge boon for capital-intensive businesses like auto manufacturing. Soon, federal regulatory credits in the U.S. are expected to be eliminated due to the passing of President Donald Trump's "big, beautiful bill." According to The Verge, "The bill, which was signed by Trump over the weekend, would eliminate tax credits for EV purchases, zero out fines for automakers who exceed fuel-efficiency targets, and roll back other incentives for wind and solar power." That second point, zeroing out fines for automakers that miss fuel efficiency targets, essentially negates any value in purchasing these credits from an automaker like Tesla. In short, Tesla will very likely lose its ability to accrue and sell federal credits in the U.S. -- an immediate and sizable hit to both revenues and profits. There are a few important details to stress about the elimination of federal automotive regulatory credits. First, these eliminations affect the U.S. only. While other countries may shift their own policies, they will, for now, remain intact. Second, these eliminations will only affect federal credit programs, not state programs like California's or New York's. Critically, Tesla does not break down its regulatory credit sales by state versus federal, or even U.S. sales versus international. Therefore, it's difficult to gauge the exact effect from the elimination of federal U.S. programs. Some analysts estimate that roughly 75% of this revenue comes from U.S. sources. Within that portion, most is likely derived from California's state-level program, since that program accounts for the majority of credit value in the U.S. overall. Last quarter, Tesla's net income plunged 71% versus a year ago to $409 million. Regulatory credits sales, meanwhile, were $595 million last quarter, exceeding a total of $3.3 billion over the last five quarters. While Tesla won't lose access to most of these credits, they are clearly critical to keeping the company profitable. Tesla is one of the only companies in the world capable of pursuing huge growth opportunities like a global robotaxi service. If profits drop by $100 million to $200 million per quarter, however, pursuing these initiatives will grow more challenging. In short, the elimination of federal regulatory credits in the U.S. won't kill Tesla. But it will make growth more difficult moving forward -- a critical factor for long-term investors to consider. Ever feel like you missed the boat in buying the most successful stocks? Then you'll want to hear this. On rare occasions, our expert team of analysts issues a 'Double Down' stock recommendation for companies that they think are about to pop. If you're worried you've already missed your chance to invest, now is the best time to buy before it's too late. And the numbers speak for themselves: Nvidia: if you invested $1,000 when we doubled down in 2009, you'd have $427,709!* Apple: if you invested $1,000 when we doubled down in 2008, you'd have $40,087!* Netflix: if you invested $1,000 when we doubled down in 2004, you'd have $671,477!* Right now, we're issuing 'Double Down' alerts for three incredible companies, available when you join , and there may not be another chance like this anytime soon.*Stock Advisor returns as of July 7, 2025 Ryan Vanzo has no position in any of the stocks mentioned. The Motley Fool has positions in and recommends Tesla. The Motley Fool recommends Stellantis. The Motley Fool has a disclosure policy. Prediction: Tesla Might Lose This $2.76 Billion Revenue Source That Is Nearly 100% Profit was originally published by The Motley Fool Fehler beim Abrufen der Daten Melden Sie sich an, um Ihr Portfolio aufzurufen. 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Forbes
10-07-2025
- Health
- Forbes
Head Start Ban: Trump Administration Says Undocumented Immigrants Blocked From Program
The Department of Health and Human Service on Thursday announced a ban on undocumented immigrants having access to Head Start and other federal programs, in the Trump administration's latest move to discourage illegal immigration. Health and Human Services Secretary Robert F. Kennedy Jr. speaks before U.S. Agriculture Secretary ... More Brooke Rollins signs three new SNAP food choice waivers for the states of Idaho, Utah, and Arkansas on June 10, 2025 in Thursday, the Department of Health and Human Services announced it officially rescinded a Clinton administration interpretation of the 1996 Personal Responsibility and Work Opportunity Reconciliation Act, which extended some federal public programs to undocumented immigrants. HHS Secretary Robert F. Kennedy Jr. said the government will no longer 'incentivize illegal immigration' by providing certain federal programs to undocumented immigrants. Programs blocked for undocumented immigrants as a result of the policy include Head Start, substance abuse treatment, mental health services, homelessness transition services and Title X family planning. Head Start did not previously require documentation of immigrant status as an enrollment requirement. Head Start is a federal early-childhood program that provides education, health and family services to low-income children and families. The program is aimed at improving school readiness and serves children from prenatal through age 5. Head Start has served over 40 million children. Key Background Trump issued an executive order in February directing federal agencies to crack down on undocumented immigrants' access to programs subsidized by taxpayers. Undocumented immigrants paid $55.8 billion in federal taxes and $33.9 billion in state and local taxes in 2023, according to the American Immigration Council. Some of the programs that HHS is restricting access to, such as Head Start, haven't historically determined program eligibility based on immigration status. 'This decision undermines the fundamental commitment that the country has made to children and disregards decades of evidence that Head Start is essential to our collective future,' said Yasmina Vinci, the executive director of the National Head Start Association, in a statement. 'Head Start programs strive to make every child feel welcome, safe, and supported, and reject the characterization of any child as 'illegal.''
Wall Street Journal
04-07-2025
- Business
- Wall Street Journal
How Immigrants Will Help Fund Trump's Tax Cuts
WASHINGTON—To help cover the cost of their marquee tax-and-spending package, Republicans have turned to a community President Trump has often targeted: immigrants. The package, which is heading to Trump's desk, includes new fees on immigrants navigating the legal process, and cutting legal immigrants out of certain federal safety-net programs. The Wall Street Journal estimates that immigrants—including those who are in the U.S. legally—will be paying in some way for at least $64 billion of the package through 2034. That helps fund new tax cuts and Trump's mass-deportation pledge.
New York Times
17-06-2025
- Business
- New York Times
House Policy Bill Would Add $3.4 Trillion to Debt, Swamping Economic Gains
House Republicans' sprawling package to cut taxes and slash federal safety-net programs would add about $3.4 trillion to the debt over the next 10 years, according to nonpartisan congressional analysts, who reported on Tuesday that the minor gains in economic growth under the bill would not offset its full fiscal impact. The updated findings from the Congressional Budget Office amounted to yet another dour report card for the president's signature legislation, which passed the House last month but now faces the prospect of significant revisions to its core components in the Senate. In its current form, the House Republican bill would extend and expand a set of expiring tax cuts enacted by Mr. Trump during his first term. It would pay for some of those expensive components with deep cuts to federal anti-poverty programs, including Medicaid and food stamps. The C.B.O. report issued on Tuesday sought to project the ways the bill would interact with federal spending and the U.S. economy, building on its earlier finding that the House-passed measure carried a roughly $2.4 trillion price tag. The nonpartisan analysts found that the House approach, if signed into law, would deliver a 0.09 percent boost to average annual growth in the nation's gross domestic product in the first few years after enactment, compared to current projections. The budget office said that lower taxes would spur some American families and businesses to spend and invest more. But it also found that the uptick in economic activity would not be sufficient to cover the costs of the legislation. Even after factoring in spending cuts, the proposal would still add nearly $2.8 trillion to federal deficits between now and 2035, according to the official tally from C.B.O. The figure grows to about $3.4 trillion if the full costs of federal borrowing are included. Want all of The Times? Subscribe.
Yahoo
17-06-2025
- Business
- Yahoo
'One Big Beautiful Bill' boosts highest earners most, Congressional Budget Office says
The legislation dubbed the "One Big Beautiful Bill'' by President Donald Trump would increase resources for middle and top earners at the expense of lower-income Americans, according to a new analysis from the Congressional Budget Office. The nonpartisan CBO analyzed the combined effects of many of the House bill's tax reductions and its cuts to federal programs, including Medicaid and nutrition assistance, for 2026 to 2034. The megabill is now in the Senate, which is considering changes. Benefits of the bill increase with income, with the lowest-tier households losing out, the CBO said. The agency compared the bill with current tax law, which encompasses Trump's 2017 Tax Cuts and Jobs Act. The bill as it stands now would extend the 2017 tax cuts, add work requirements to Medicaid and the Supplemental Nutrition Assistance Program (SNAP, or food stamps), give seniors an additional tax credit to help offset Social Security taxes, and create savings accounts for babies, among other things. Here is how the CBO says the bill would affect Americans: Those in the lowest income group would lose about $1,600 in resources a year, which is about 3.9% of their income, mostly because of reductions in noncash transfers, such as Medicaid and SNAP. Because many in this group pay little to no federal taxes, they would benefit less from tax cuts than higher income groups. Middle-income households would see their resources increase by $500 to $1,000, or 0.5% to 0.8% of their projected income. The top 10% of households would see a gain of about $12,000, or about 2.3% of income, mostly because of tax cuts. Medora Lee is a money, markets, and personal finance reporter at USA TODAY. You can reach her at mjlee@ and subscribe to our free Daily Money newsletter for personal finance tips and business news every Monday through Friday. This article originally appeared on USA TODAY: Who wins and loses in Trump tax bill? CBO breaks it down
