Trump tax bill: US President Donald Trump’s most ambitious tax and spending scheme is now moving towards final voting in the lower house of the US Parliament (House of Representatives). There has been a tremendous tussle in America’s politics about this bill. Trump considers it to be the basis of his potential second term, but he has had to struggle a lot in getting it passed. Trump himself called this bill “One Big, Beautiful Bill”.
The bill includes disputed proposals such as cutting social welfare programs and adding additional national debt of three trillion dollars. Many MPs of the Republican Party have also opposed it with Democrats.
NRI and Indian professionals get big relief
The biggest relief in this controversial bill is for Indian migrants. Around 45 lakh Indians living in the US were relieved when the proposed tax rate on international money transfer was reduced from 5% to just 1% in the latest draft of the bill. This will provide great relief to those Indians who transfer money at their home.
In the revised draft released on June 27, it was clarified that this tax would be applicable only to those who are residents of America but are not American citizens. It also includes professionals and foreign students working on green card holders, H-1B and H-2A visas.
Which transactions will not be taxed?
An important change in the bill has also been made that certain types of money transfer will be completely released from this tax. According to the draft, if the money is being sent from the US bank account or the transaction is being done by debit/credit card, then there will be no tax on it.
Tax will be applicable only to the money sent through cash, money order or cashier check. This will directly affect millions of overseas Indians who send money to their families in India through traditional mediums.
How did the bill change and why there is dispute?
The bill was passed by the House of Representatives in May, but after just one vote in the Senate, he was sent back to the lower house with some amendments. The most important change of these was about money transfer tax. Those opposing the bill say that this will increase the national debt of America even more and will weaken social welfare schemes. But Trump is calling it a big step towards America’s economic strength.