Supreme Court Upholds FCC's $8.6 Billion Telecom Subsidy Fund
The US Supreme Court upheld the $8.6 billion Universal Service Fund, the annual slate of subsidies that helps cover the cost of telecom services for low-income people, rural residents, schools and libraries.
Voting 6-3, the justices rejected contentions that Congress unconstitutionally handed off its taxing powers when it set up the program in 1976. The fund uses a charge imposed on monthly phone bills – in an amount determined by the Federal Communications Commission – to subsidize service for more than 8 million people.
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CNN
17 minutes ago
- CNN
The ‘revenge tax' is dead before it even started
The Treasury Department and Congress on Thursday moved to kill a so-called revenge tax that was set to raise taxes on foreign investment and had spooked Wall Street and global business leaders. Treasury Secretary Scott Bessent on Thursday announced a deal with G7 partners that will exclude US companies from some global taxes in exchange for the US dropping Section 899 from Republican's 'One Big Beautiful Bill Act.' Bessent said in a post on X that he would ask Congress to remove Section 899 from the budget bill. Senator Mike Crapo and Rep. Jason Smith, who co-chair the joint committee on taxation, said in a statement Thursday that following Bessent's request, they would remove Section 899 from the bill. Section 899 was a tax code tucked in to President Donald Trump's budget bill that would have raised taxes on the income earned from US assets held by individuals or businesses in other countries with taxes the US perceived as unfair for American businesses. The provision would 'facilitate penalty taxes on foreign companies operating in the US if their home country is deemed to have a 'discriminatory' tax system,' analysts at Citi said in a note. The tax code was considered a 'revenge' tax because it was designed to retaliate against a global tax framework agreed upon in 2021 by the Biden administration and the Organization for Economic Cooperation and Development, according to Mark Luscombe, principal federal tax analyst at Wolters Kluwer. Former Treasury Secretary Janet Yellen had negotiated a tax agreement with other OECD countries that included setting a global minimum tax rate of 15%. Republicans had opposed the agreement and thought it was unfair, arguing it ceded authority on taxation, Luscombe said. The 'revenge tax' also was set to retaliate against digital services taxes, or taxes on US tech companies that provide services to users in other countries. Digital services taxes were perceived as 'discriminatory' by the Trump administration, said James Knightley, chief international economist at ING. Trump had previously signed an executive order on his first day in office announcing that tax deals agreed upon between the Biden administration and the OECD were null. Bessent's announcement leaves room for how the United States and other countries might negotiate on taxes. 'The Trump Administration remains vigilant against all discriminatory and extraterritorial foreign taxes applied against Americans,' Bessent said in his post on X. 'We will defend our tax sovereignty and resist efforts to create an unlevel playing field for our citizens and companies.' The so-called revenge tax, which had stirred debates on Wall Street and law firms across the Atlantic, is moot before it even went into effect. There had been back-and-forth debates in recent weeks about the implications of Section 899 and whether it would push global investors away from the United States. The provision had sent shivers up Wall Street's spine as it appeared to be another protectionist policy that would penalize global investors who put their money in the United States. 'Great concern had been expressed by Wall Street and affected stakeholders about the enactment of Section 899 and its impact on foreign investment in the United States, particularly in view of its complexity, potential scope of application and compliance obligations,' attorneys at law firm Holland & Knight said in a note. 'Those concerns have been alleviated for now.' International business groups were in Wasington in recent weeks negotiating with lawmakers. Jonathan Samford, CEO of the Global Business Alliance, which opposed Section 899, told CNN the provision would have 'squandered opportunity and more investment' and contributed to 'further isolation.' 'We're very pleased that President Trump and the administration have pursued this negotiation, and as a result, called for withdrawal of this punitive and discriminatory provision,' he said. 'I commend Chairman Smith and Chairman Crapo for focusing on making the United States the most competitive it can be.' Republicans this week had begun hinting that Section 899 might be negotiable. Director of the National Economic Council Kevin Hassett said in an interview with Fox Business on Wednesday that Section 899 might not be included in the final budget bill. 'You can try to retaliate, but it's probably better to work out an agreement than just have a tax fight, just like we're having tariff fights,' Luscombe said.
USA Today
23 minutes ago
- USA Today
President Trump hedges on deadline for mega tax bill to pass Congress
WASHINGTON − President Donald Trump is trying to blame Democrats as his "big, beautiful bill" appears to be stalled in the Republican-controlled Senate, leaving the second-term president and his GOP allies scrambling to find a way to push forward on campaign promises to eliminate taxes on tips and spend more money on border enforcement. "The problem we have is that it's a great bill, it's a popular bill," Trump said during a June 27 White House press conference of the sweeping piece of legislation that is not polling well with many Americans. "But we'll get no Democrats only because they don't want to vote for Trump." Trump has pressed Senate Republicans to stay on his ambitious timeline to complete their work by July 4 and get the measure to his desk for signature into law. But the president also acknowledged his ambitions might not become reality amid deep internal GOP policy disputes and complex Senate rules that have sent the mega bill through the legislative shredder. More: GOP senators negotiate Trump budget bill in hopes of improving its polling Among the many concerns Republicans are still trying to work through are their own proposed cuts for Medicaid eligibility, which Democrats already see as a winning political message for them in the upcoming 2026 midterm elections where they're looking to retake majorities in both the House and Senate. Trump has said previously he wants Congress to pass the sweeping bill and get it to his desk by Independence Day. But for that to happen the Senate still needs to finalize and pass its version, before then sending it back to the GOP-led House to reconcile any differences with their efforts that previously won approval with the slimmest of majorities in May. As the Senate continues to grapple with concerns including the legislation's high cost and the Medicaid language, Trump is hedging his own deadline. "It's important," but, "it's not the end-all," Trump told reporters on June 27. "We'd like to get it done by that time, if possible," Trump said. Further complications have come in the form of Parliamentarian Elizabeth MacDonough's ruling on what is and is not within the scope of a spending bill. MacDonough, a nonpartisan official, found several Senate Republicans' provisions in violation, including attempts to repeal federal food aid for noncitizens, multiple measures softening environmental regulations and deregulation for gun silencers. "The parliamentarian's been a little difficult," Trump said. "I would say that I disagree with the parliamentarian on some things, and on other ways, she's been fine." Trump did not go so far as to call for her termination, though, unlike some Republicans on Capitol Hill. The president is instead laying the groundwork to pin the blame on his congressional opponents. "The Democrats won't approve it only because politically it's so good for the Republicans," Trump said. "If I were a Democrat, I would vote for this bill all day long," he added. Polling has shown Trump's bill is not scoring well with in public opinion. Fewer than 30% of voters support the bill in three recent surveys by Pew, Quinnipiac and the Washington Post-Ipsos. The bill is doubtful to get support from any Senate Democrat, but under special Senate rules, only 51 Republicans are needed to sign-off and avoid a filibuster.
Los Angeles Times
28 minutes ago
- Los Angeles Times
A stunning and tragic Supreme Court decision
The Supreme Court on Friday dealt a grievous blow to separation of powers by holding that federal courts cannot issue nationwide injunctions to halt unconstitutional actions by the president and the federal government. At a time when President Trump is asserting unprecedented powers, the court made it far more difficult to restrain his unconstitutional actions. The case, Trump vs. CASA, involved the president's executive order ending birthright citizenship. The first sentence of the 14th Amendment provides that 'all persons born or naturalized in the United States, and subject to the jurisdiction thereof, are citizens of the United States and of the State wherein they reside.' In 1898, in United States vs. Wong Kim Ark, the Supreme Court held that this means that everyone born in the United States, regardless of the immigration status of their parents, is a United States citizen. The court explained that 'subject to the jurisdiction thereof' was meant to exclude just children born to soldiers in an invading army or those born to diplomats. Trump's executive order directly contradicted this precedent and our national understanding of citizenship by decreeing that only those born here to citizens or to residents with green cards are citizens too. Immediately, several federal courts issued nationwide injunctions to stop this from going into effect. But the Supreme Court, in a 6-3 ruling split along ideological lines, said that federal courts lack the power to issue such orders. Justice Amy Coney Barrett, writing for the conservative justices, declared that such universal injunctions 'likely exceed the equitable authority that Congress has granted to federal courts.' Justice Clarence Thomas, in a concurring opinion, put this succinctly: 'Today puts an end to the 'increasingly common' practice of federal courts issuing universal injunctions.' Indeed, the court's opinion indicated that a federal court can give relief only to the plaintiffs in a lawsuit. This is a radical limit on the power of the federal courts. Nothing in any federal law or the Constitution justifies this restriction on the judicial power. The court did not rule on the constitutionality of Trump's executive order ending birthright citizenship, but it made it far more difficult to stop what is a clearly unconstitutional act. The practical consequences are enormous. It would mean that to challenge the constitutionality of a presidential action or federal law a separate lawsuit will need to be brought in all 94 federal districts. It means that the law often will be different depending on where a person lives. Astoundingly, it could mean that there could be two people born in identical circumstances in different federal districts and one would be a citizen, while the other would not. This makes no sense. It will mean that the president can take an unconstitutional act and even after courts in some places strike it down, continue it elsewhere until all of the federal districts and all of the federal court of appeals have invalidated it. In fact, the court said that a federal court can give relief only to the named plaintiff, which means that in the context of birthright citizenship each parent affected by the birthright citizenship executive order will need to sue separately. Never before has the Supreme Court imposed such restrictions on the ability of courts to provide relief against unconstitutional acts. The court holds open the possibility of class actions as a way around this. But the requirements for class action litigation are often burdensome, and the Supreme Court has consistently made it much more difficult to bring such suits. Justice Sonia Sotomayor in a powerful dissent expressed what this means. She wrote: 'No right is safe in the new legal regime the Court creates. Today, the threat is to birthright citizenship. Tomorrow, a different administration may try to seize firearms from law-abiding citizens or prevent people of certain faiths from gathering to worship. The majority holds that, absent cumbersome class-action litigation, courts cannot completely enjoin even such plainly unlawful policies unless doing so is necessary to afford the formal parties complete relief. That holding renders constitutional guarantees meaningful in name only for any individuals who are not parties to a lawsuit. Because I will not be complicit in so grave an attack on our system of law, I dissent.' Let there be no doubt what this means; the Supreme Court has greatly reduced the power of the federal courts. And it has done so at a time when the federal judiciary may be our only guardrail to protect the Constitution and democracy. As Justice Ketanji Brown Jackson explained in her dissent, 'The Court's decision to permit the Executive to violate the Constitution with respect to anyone who has not yet sued is an existential threat to the rule of law.' It is a stunning and tragic limit on the power of the courts to enforce the Constitution. Erwin Chemerinsky, dean of the UC Berkeley Law School, is an Opinion Voices contributing writer.
