Latest news with #wealthtransfer
Gulf Business
2 days ago
- Business
- Gulf Business
Hottest investment trends in the UAE: Watch our latest Breakfast Briefing panel event
From global mobility and residence-by-investment to IPO outlooks and the great wealth transfer, this Gulf Business panel event in Dubai on June 25 brought together leading voices to decode the UAE's investment landscape. Speakers included: George Hojeige, Group CEO, Virtugroup Rahul Singh, MD, Thrifty & Dollar Car Rental Sanjay Sachdev, Group Marketing Director, Leptos Estates Vishwajit Patil, SEO, Nuvama Private DIFC Yogesh Khairajani, Global Market Strategist, Century Financial Manasvi Ghelani, Associate Director, Frost & Sullivan Muhammed Hassan, Capital Markets Leader, PwC Damian Hitchen, CEO, Saxo Bank MENA Yasmine Omari, Head of Wealth Planning, Bank of Singapore Gemma Wild, Head of Global Collaboration, MENA GPB, HSBC Dave Chaggar, Sales Director, Capital Club Limited Moderators: Claire Vuylsteke, Director, Orbcom Nigel Sillitoe, CEO, Insight Discovery Karishma Hingorani, Founder, Karishma Konnect
CBS News
2 days ago
- Business
- CBS News
GOP budget bill could transfer wealth from young Americans to older generations, study finds
The Republican budget package aims to make President Donald Trump's tax cuts permanent while offering a host of new financial breaks. Yet the "big, beautiful bill," as the legislation is dubbed, could also effectively transfer wealth from younger generations to older Americans over their lifetimes, a recent study finds. Long-term, the primary beneficiaries of the GOP bill would be older, wealthier Americans, while younger, middle- to low-income people would see fewer benefits, according to the analysis from the Penn Wharton Budget Model, a University of Pennsylvania think tank that studies the fiscal issues. The group's projection assesses the impact of proposed tax cuts under the bill, as well as reductions in federal programs such as Medicaid and the Supplemental Nutrition Assistance Program, or SNAP, better known as food stamps. Penn Wharton also factors in the long-term fiscal impact of the debt the U.S. would likely have to issue to pay for the bill's tax cuts, the group said. "Somebody has to pay" Younger Americans would bear the brunt of the nation's spiraling debt, Kent Smetters, director of the Penn Wharton Budget Model, told CBS MoneyWatch. "Somebody has to pay — nothing is for free. In this case, that's the future generations," he said. "We have finally reached this inflection point where under any reasonable estimation, younger people are going to be worse off in the future" if the current version of the bill is passed. For example, the bill would cost an infant born into a low-income family $14,100 over their lifetime. This loss stems from factors including reduced social safety net benefits and lower wages resulting from slower economic growth driven by increased national debt and deficits. On the other hand, a high-income 70-year-old stands to gain $120,000 over his remaining years due to the proposed legislation's tax cuts and other benefits, the analysis found. The House narrowly passed the legislation in May. Senate lawmakers are pressing to vote on the measure by the end of the week. The White House took issue with Penn Wharton's analysis. "So-called 'experts' panning the One, Big, Beautiful Bill without a smidge of humility should remember that they made these same exact gloomy predictions about President Trump's tax cuts during his first term – tax cuts that helped usher in historic job, wage, investment and economic growth along with the first decline in wealth inequality in decades," White House spokesman Kush Desai told CBS MoneyWatch. Biggest winners Like Penn Wharton, other researchers have said the Republican bill is likely to benefit wealthy Americans at the expense of people lower down the ladder. The measure would likely reduce the financial resources available to the lowest-earning 10% of U.S. households by $1,600 per year, or almost 4% of their annual income, according to a report published earlier this month by the nonpartisan Congressional Budget Office. White House officials have previously questioned the CBO's scoring of the bill. But the highest-earning 10% of households would see a gain of $12,000 per year in resources, while middle-income households would see a gain of $500 to $1,000, the CBO projected. Its analysis is based on the bill's tax breaks, as well as reductions for federal programs and reductions in state funds for safety net programs such as Medicaid and food stamps. In considering the impact of higher U.S. debt on future generations, the cost would come in the form of lower wages and higher costs, such as more expensive mortgages, Smetters said. Already, the U.S. is spending more than $1 trillion a year to service its debt — almost double the amount it was paying five years ago, according to Federal Reserve Bank of St. Louis data. That's more than the nation currently spends on defense, data from the Stockholm International Peace Research Institute shows. Clock ticking Taking on more debt to pay for the GOP bill could make it tougher for the federal government to pay for programs like Social Security as more of its budget is eaten up by interest payments. Higher debt would also likely result in higher interest rates, as well as slowing economic growth, the Yale Budget Lab projects. Elements of the bill are still under debate on Capitol Hill, with congressional Republicans racing to meet a self-imposed July 4 deadline to send the package to President Trump for his signature. The last scheduled day in session for both the House and Senate before they leave town for the holiday is Friday, leaving little time to reach a deal. Some Republicans are at loggerheads over certain provisions, such as the state and local tax deduction, known as SALT, with House lawmakers pushing for a bigger deduction than in the Senate. If the bill moves ahead, the long-term combination of benefit reductions and swelling federal debt could outweigh the benefits of tax cuts for younger Americans, the Penn Wharton analysis said. "Sometimes people say, 'If I'm in 40th-60th [percentile of income], I won't get SNAP or Medicaid,' but actually there is a chance that you could still," Smetters said. "There is a chance anybody could be unemployed or be on food stamps."
Fast Company
3 days ago
- Business
- Fast Company
Trump's Big Beautiful Bill would transfer wealth from young to older Americans. Here's how
U.S. President Donald Trump's sweeping tax-cut legislation would effectively transfer wealth from younger Americans to older generations, nonpartisan analysts say. Though the bill contains tax breaks for parents, newborns, private-school students and other younger Americans, those benefits would be outweighed by the trillions of dollars it would add to the $36.2 trillion national debt, they say. That could push down economic growth over the long term and leave younger people saddled with higher taxes and mortgage payments. 'Future generations are kind of left holding the bag,' said Kent Smetters, director of the Penn Wharton Budget Model. The nonpartisan research organization found that a 40-year-old earning close to the median income would effectively lose $7,500 over the course of a lifetime if the bill became law. A 70-year-old with the same income, by contrast, would end up $17,500 richer. Several factors contribute to this disparity. Younger workers, who typically earn less, would not benefit as much from the bill's income tax cuts compared to those at the peak of their earning years. They would also be more exposed to cutbacks in student aid and the Medicaid health program, which covers four out of 10 hospital births in the United States. 'In the short term the benefits are certainly tilted towards higher earners, which is often a good proxy for age,' said Jessica Riedl of the conservative Manhattan Institute. But the biggest factor, analysts say, is the $3 trillion the bill would add to the national debt. That is likely to push up interest rates in the years to come and require the government to devote a growing portion of its budget to debt service rather than other purposes. 'There is an obvious intergenerational transfer here,' said John Ricco of the Yale Budget Lab, which found that the bill would add $4,000 to the annual cost of a home mortgage in the year 2055, when today's newborns will be 30 years old. Republican lawmakers say the bill, which passed the House of Representatives and is now pending in the Senate, would help younger Americans by putting Medicaid on a more sustainable footing and boosting economic growth and entrepreneurship, which would help younger people entering the workforce. The bill also follows through on Trump's campaign promises by carving out new tax breaks for tipped income and overtime pay, which Republicans say could help younger workers in service and hourly wage jobs. SAVINGS ACCOUNTS The bill also would set up $1,000 savings accounts for newborns and expand a child tax break, though the details differ between the House and Senate versions of the bill. No. 2 House Republican Representative Steve Scalise said after the bill's passage in May that the legislation would increase take-home pay for a median income household with two children by $4,000 to $5,000. That calculation, however, does not factor in the increased costs many lower- and middle-income families would have to pay for health care, student loans and groceries due to the bill's cutbacks in those areas. The Congressional Budget Office and other outside analysts have found that those costs would outweigh any savings those households might gain from tax cuts, while the child tax credit and other targeted tax breaks also would not be fully available to low-income families. That pattern holds true for poor Americans of all ages. The bill includes a targeted tax break for people over 65 promised by Trump during last year's election, but many do not pay enough income tax to qualify for it, said Brendan Duke of the left-leaning Center on Budget and Policy Priorities. 'The tax cuts basically do nothing for the lower-income half of seniors,' he said. Still, those seniors benefit from another Trump campaign promise, as the bill spares Medicare, the health plan for seniors, and Social Security, the U.S. pension program, from the sort of cost-cutting it applies to Medicaid. Medicare and Social Security are growing rapidly as the population ages, crowding out other government spending, and are projected to run short of funds in 2033. But Trump and his Democratic rivals have both vowed to shield the two politically popular programs from restructuring, which will leave future generations to confront the problem. 'I think ultimately Republican and Democratic lawmakers have been engaged in intergenerational theft for a long time,' Riedl said.
Yahoo
3 days ago
- Business
- Yahoo
Trump's budget plan shifts wealth from young to old, analysts say
By Andy Sullivan WASHINGTON (Reuters) -U.S. President Donald Trump's sweeping tax-cut legislation would effectively transfer wealth from younger Americans to older generations, nonpartisan analysts say. Though the bill contains tax breaks for parents, newborns, private-school students and other younger Americans, those benefits would be outweighed by the trillions of dollars it would add to the $36.2 trillion national debt, they say. That could push down economic growth over the long term and leave younger people saddled with higher taxes and mortgage payments. "Future generations are kind of left holding the bag," said Kent Smetters, director of the Penn Wharton Budget Model. The nonpartisan research organization found that a 40-year-old earning close to the median income would effectively lose $7,500 over the course of a lifetime if the bill became law. A 70-year-old with the same income, by contrast, would end up $17,500 richer. Several factors contribute to this disparity. Younger workers, who typically earn less, would not benefit as much from the bill's income tax cuts compared to those at the peak of their earning years. They would also be more exposed to cutbacks in student aid and the Medicaid health program, which covers four out of 10 hospital births in the United States. "In the short term the benefits are certainly tilted towards higher earners, which is often a good proxy for age," said Jessica Riedl of the conservative Manhattan Institute. But the biggest factor, analysts say, is the $3 trillion the bill would add to the national debt. That is likely to push up interest rates in the years to come and require the government to devote a growing portion of its budget to debt service rather than other purposes. "There is an obvious intergenerational transfer here," said John Ricco of the Yale Budget Lab, which found that the bill would add $4,000 to the annual cost of a home mortgage in the year 2055, when today's newborns will be 30 years old. Republican lawmakers say the bill, which passed the House of Representatives and is now pending in the Senate, would help younger Americans by putting Medicaid on a more sustainable footing and boosting economic growth and entrepreneurship, which would help younger people entering the workforce. The bill also follows through on Trump's campaign promises by carving out new tax breaks for tipped income and overtime pay, which Republicans say could help younger workers in service and hourly wage jobs. SAVINGS ACCOUNTS The bill also would set up $1,000 savings accounts for newborns and expand a child tax break, though the details differ between the House and Senate versions of the bill. No. 2 House Republican Representative Steve Scalise said after the bill's passage in May that the legislation would increase take-home pay for a median income household with two children by $4,000 to $5,000. That calculation, however, does not factor in the increased costs many lower- and middle-income families would have to pay for health care, student loans and groceries due to the bill's cutbacks in those areas. The Congressional Budget Office and other outside analysts have found that those costs would outweigh any savings those households might gain from tax cuts, while the child tax credit and other targeted tax breaks also would not be fully available to low-income families. That pattern holds true for poor Americans of all ages. The bill includes a targeted tax break for people over 65 promised by Trump during last year's election, but many do not pay enough income tax to qualify for it, said Brendan Duke of the left-leaning Center on Budget and Policy Priorities. "The tax cuts basically do nothing for the lower-income half of seniors," he said. Still, those seniors benefit from another Trump campaign promise, as the bill spares Medicare, the health plan for seniors, and Social Security, the U.S. pension program, from the sort of cost-cutting it applies to Medicaid. Medicare and Social Security are growing rapidly as the population ages, crowding out other government spending, and are projected to run short of funds in 2033. But Trump and his Democratic rivals have both vowed to shield the two politically popular programs from restructuring, which will leave future generations to confront the problem. "I think ultimately Republican and Democratic lawmakers have been engaged in intergenerational theft for a long time," Riedl said.
Yahoo
3 days ago
- Business
- Yahoo
Trump's budget plan shifts wealth from young to old, analysts say
By Andy Sullivan WASHINGTON (Reuters) -U.S. President Donald Trump's sweeping tax-cut legislation would effectively transfer wealth from younger Americans to older generations, nonpartisan analysts say. Though the bill contains tax breaks for parents, newborns, private-school students and other younger Americans, those benefits would be outweighed by the trillions of dollars it would add to the $36.2 trillion national debt, they say. That could push down economic growth over the long term and leave younger people saddled with higher taxes and mortgage payments. "Future generations are kind of left holding the bag," said Kent Smetters, director of the Penn Wharton Budget Model. The nonpartisan research organization found that a 40-year-old earning close to the median income would effectively lose $7,500 over the course of a lifetime if the bill became law. A 70-year-old with the same income, by contrast, would end up $17,500 richer. Several factors contribute to this disparity. Younger workers, who typically earn less, would not benefit as much from the bill's income tax cuts compared to those at the peak of their earning years. They would also be more exposed to cutbacks in student aid and the Medicaid health program, which covers four out of 10 hospital births in the United States. "In the short term the benefits are certainly tilted towards higher earners, which is often a good proxy for age," said Jessica Riedl of the conservative Manhattan Institute. But the biggest factor, analysts say, is the $3 trillion the bill would add to the national debt. That is likely to push up interest rates in the years to come and require the government to devote a growing portion of its budget to debt service rather than other purposes. "There is an obvious intergenerational transfer here," said John Ricco of the Yale Budget Lab, which found that the bill would add $4,000 to the annual cost of a home mortgage in the year 2055, when today's newborns will be 30 years old. Republican lawmakers say the bill, which passed the House of Representatives and is now pending in the Senate, would help younger Americans by putting Medicaid on a more sustainable footing and boosting economic growth and entrepreneurship, which would help younger people entering the workforce. The bill also follows through on Trump's campaign promises by carving out new tax breaks for tipped income and overtime pay, which Republicans say could help younger workers in service and hourly wage jobs. SAVINGS ACCOUNTS The bill also would set up $1,000 savings accounts for newborns and expand a child tax break, though the details differ between the House and Senate versions of the bill. No. 2 House Republican Representative Steve Scalise said after the bill's passage in May that the legislation would increase take-home pay for a median income household with two children by $4,000 to $5,000. That calculation, however, does not factor in the increased costs many lower- and middle-income families would have to pay for health care, student loans and groceries due to the bill's cutbacks in those areas. The Congressional Budget Office and other outside analysts have found that those costs would outweigh any savings those households might gain from tax cuts, while the child tax credit and other targeted tax breaks also would not be fully available to low-income families. That pattern holds true for poor Americans of all ages. The bill includes a targeted tax break for people over 65 promised by Trump during last year's election, but many do not pay enough income tax to qualify for it, said Brendan Duke of the left-leaning Center on Budget and Policy Priorities. "The tax cuts basically do nothing for the lower-income half of seniors," he said. Still, those seniors benefit from another Trump campaign promise, as the bill spares Medicare, the health plan for seniors, and Social Security, the U.S. pension program, from the sort of cost-cutting it applies to Medicaid. Medicare and Social Security are growing rapidly as the population ages, crowding out other government spending, and are projected to run short of funds in 2033. But Trump and his Democratic rivals have both vowed to shield the two politically popular programs from restructuring, which will leave future generations to confront the problem. "I think ultimately Republican and Democratic lawmakers have been engaged in intergenerational theft for a long time," Riedl said. Error in retrieving data Sign in to access your portfolio Error in retrieving data Error in retrieving data Error in retrieving data Error in retrieving data
