Bad news for NRIs, Indian students in US as Trump brings new law that..., set to affect India due to...
Trump remittance tax: In a significant development that could severely impact Indian students and Non-Resident Indians (NRIs) in the United States, the US Senate Tuesday passed President Donald Trump's 'One Big Beautiful Bill Act', which, among other things, imposes a new tax on overseas money transfers by non-US citizens. What is the new Trump remittance tax?
The new tax law, dubbed by many as the Trump remittance tax, which comes into effect on July 4, 2025, imposes a one percent levy levy on remittances made through cash, money orders, or cashier's cheques. The tax applies on remittances made by anyone who is not a US citizens, including Green Card holders, people on temporary visas such as H-1B or H-2A and foreign students.
The remittance tax impacts Indian students and H-1B workers who will now have to pay extra to send money back home. For example, if someone sends about Rs 100,000 ($1,160) back home to India, that person will now have to pay an extra Rs 1,000 in tax. The money will be collected by the remittance provider such as Western Union, MoneyGram or any bank, and passed on to the US government every quarter.
However, in a big relief, the tax rate was reduced to 1 percent in the final bill, against the initially proposed 5 percent. How much remittances does India receive?
Foreign remittances are a key source of India's forex reserves, with the country receiving $129 Billion in international remittances in 2024—the highest in the world, according to the World Bank. About 28 percent of India's remittance inflows in 2023-24 came from the United States.
According to the data, states like Uttar Pradesh, Bihar, and Kerala, where millions of families are highly dependent on foreign remittances, may bear the brunt of Trump's new tax law.
Millions of families in these states depend on remittances, which they use to meet expenses like education, healthcare and housing. But a sudden decline in remittance could drastically limit their spending power, and put more pressure on the Indian economy, which is already facing the challenges of global uncertainty and inflation, econ0mists say. Why US remittance could impact India's forex reserves?
According to economist, the new remittance tax could deeply impact India's foreign exchange reserves (forex) as Indians in US would send less money back home due to the 1 percent levy.
Earlier, Ajay Srivastava, a senior economist, had predicated that India could lose between $12-18 billion if remittances from the US fall by 10-15 percent.
In a recent interview, Srivastava asserted that lower remittances means less inflow of the US Dollar in India's foreign exchange market, negatively impacting the Indian Rupee, which would force repeated interventions from the Reserve Bank of India (RBI) to stabilize the currency. He predicted that the rupee may fall about Rs 1.5 against the dollar, in wake of reduced remittances.
Hashtags
Try Our AI Features
Explore what Daily8 AI can do for you:
Comments
No comments yet...
Related Articles
NDTV
33 minutes ago
- NDTV
Trump Scores Big Victory As 'One Big Beautiful Bill' Clears Congress
US President Donald Trump on Thursday secured a major political victory when Congress narrowly passed his flagship tax and spending bill, cementing his radical second-term agenda and boosting funds for his anti-immigration drive. The bill underlined the president's dominance over the Republican Party, which had been wracked by misgivings over a text that will balloon the national debt and gut health and welfare support. A small group of opponents in the party finally fell into line after Speaker Mike Johnson worked through the night to corral dissenters in the House of Representatives behind the "One Big Beautiful Bill." The bill squeezed past a final vote 218-214, meaning it can be on Trump's desk to be signed into law on the July 4th Independence Day holiday. "One of the most consequential Bills ever. The USA is the 'HOTTEST' Country in the World, by far!!!" Trump said on social media as he scented victory. The timing of the vote slipped back as Democratic minority leader Hakeem Jeffries spoke against the bill for nearly nine hours to delay proceedings. Mass Deportations, Tax Breaks The legislative win is the latest in a series of successes for Trump, including a Supreme Court ruling last week that curbed lone judges from blocking his policies, and US air strikes that led to a ceasefire between Israel and Iran. His sprawling mega-bill just passed the Senate on Tuesday and had to return to the lower chamber for a rubber stamp of the senators' revisions. The package honors many of Trump's campaign promises: boosting military spending, funding a mass migrant deportation drive and committing $4.5 trillion to extend his first-term tax relief. "Today we are laying a key cornerstone of America's new Golden Age," Johnston said. But it is expected to pile an extra $3.4 trillion over a decade onto the country's fast-growing deficits, while shrinking the federal food assistance program and forcing through the largest cuts to the Medicaid health insurance scheme for low-income Americans since its 1960s launch. Some estimates put the total number of recipients set to lose their insurance coverage under the bill at 17 million. Scores of rural hospitals are expected to close. While Republican moderates in the House fear the cuts will damage their prospects of reelection, fiscal hawks chafed over savings that they say fall far short of what was promised. Johnson had to negotiate tight margins, and could only lose a handful of lawmakers in the final vote, among more than two dozen who had earlier declared themselves open to rejecting Trump's 869-page text. Trump has spent weeks hitting the phones and hosting White House meetings to cajole lawmakers torn between angering welfare recipients at home and incurring the president's wrath. Democrats hope public opposition to the bill will help them flip the House in the 2026 midterm election, pointing to data showing that it represents a huge redistribution of wealth from the poorest Americans to the richest. Jeffries held the floor for his Democrats ahead of the final vote, as he told stories of everyday Americans who he argued would be harmed by Trump's legislation. "This bill, this one big, ugly bill -- this reckless Republican budget, this disgusting abomination -- is not about improving the quality of life of the American people," he said. Extra spending on the military and border security will be paid in part through ending clean energy and electric vehicle subsidies -- a factor triggering a bitter public feud between Trump and former supporter Elon Musk.
Time of India
35 minutes ago
- Time of India
'There's a lot being said about me, most of you don't know the full story. If ...,' says Soham Parekh, the techie accused of working for multiple companies simultaneously
Soham Parekh An Indian software engineer, Soham Parekh , is at the center of controversy following allegations of moonlighting at multiple US startups simultaneously. The accusations surfaced when Suhail Doshi , co-founder and former CEO of Mixpanel, publicly called out Parekh on Twitter, warning startup founders about his alleged deceptive practices. Doshi claimed that Parekh, who holds a Master's degree in computer science from Georgia Tech and a Bachelor's from the University of Mumbai, was secretly employed at three to four startups at once, targeting Y Combinator-backed companies. Doshi revealed that Parekh briefly worked at his company, Playground AI, but was terminated within a week after his alleged duplicity was uncovered. Doshi further escalated the issue by sharing Parekh's CV online, labeling it 'probably 90 per cent fake' and listing companies such as Dynamo AI, Union AI, Synthesia, Alan AI, and Fleet AI where Parekh allegedly held concurrent roles. Doshi stated he verified his claims with over six companies before going public. Soham Parekh responds to Suhail Doshi's post 'exposing' him In response, Parekh took to Twitter to address the allegations, defending his passion for building technology. Responding to Suhail Doshi's post, Soham Parekh wrote, "There's a lot being said about me right now, and most of you don't know the full story. If there's one thing to know about me, it's that I love to build. That's it. I've been isolated, written off, and shut out by nearly everyone I've known and every company I've worked at. But building is the only thing I've ever truly known, and it's what I'll keep doing," he wrote. Parekh claimed he has faced isolation and rejection from companies and peers but announced he had signed an exclusive deal as a founding engineer with a single company in the video AI space, set to launch later this month. 'I'm pissed. And I've got something to prove,' he added. by Taboola by Taboola Sponsored Links Sponsored Links Promoted Links Promoted Links You May Like An engineer reveals: One simple trick to get internet without a subscription Techno Mag Learn More Undo The controversy has sparked debates in the tech community about moonlighting, ethics, and transparency in the startup ecosystem. Neither Parekh nor the accused companies have released further statements, and the matter remains under scrutiny as the tech world awaits further developments Soham Parekh reaches out to Suhail Doshi Suhail Doshi later posted on X that Parekh reached out to him privately, asking him for advice on how to set this right. Without divulging his response, the entrepreneur simply wrote, "Vox Populi, Vox Dei". AI Masterclass for Students. Upskill Young Ones Today!– Join Now
Hans India
an hour ago
- Hans India
Amazon India announces Prime Day 2025 Deals
· Three days, three times the excitement: This year, Prime Day 2025 brings the biggest deals, amazing launches, entertainment and savings like never before! · New launches and deals from top brands: Prime members will get early access to thousands of new product launches from over 400 top Indian & global brands along across categories including Smartphones, Electronics and Appliances, Fashion, Beauty products, Home and Kitchen essentials, Grocery and more · Exciting offers from leading partner banks: Save Big with 10% savings on payment using ICICI Bank Credit & Debit cards, SBI Credit Cards and EMI transactions on ICICI Bank Credit Cards and SBI Credit Cards* · Blockbuster Entertainment: Prime Video announces an exciting line-up of 17 Indian and international series and movies across multiple languages leading up to this Prime Day. Prime members can enjoy the best of entertainment from India and across the world, including from the US, Japan and Korea Amazon India today announced the most anticipated Prime Day 2025 deals, exclusively for Prime members. Starting from 12:00 AM on July 12 to 11:59 PM on July 14, shoppers can look forward to 72 hours of non-stop shopping, unbeatable deals, and blockbuster entertainment. Whether you're looking to upgrade your tech, refresh your wardrobe or home, Prime Day brings fantastic savings across categories including Smartphones, Consumer Electronics, TVs, Appliances, Amazon Devices, Fashion and Beauty, Home and Kitchen, Furniture, Everyday Essentials, and much more. It's the perfect time to shop, indulge, and make the most of your Prime membership with offers curated specially for Prime members. Customers can save big with 10% savings on payments using ICICI Bank Credit & Debit cards, SBI Credit Cards and EMI transactions on ICICI Bank Credit Cards and SBI Credit Cards.* Prime Day 2025 Deals* – A Sneak Peek! Smartphones and Accessories ● Prime Day Premiers will host new launches across top smartphone brands. Customers can get their hands on the latest launches in mobile technology, offering a variety of new features and vibrant colours. ● The line-up includes Samsung Galaxy M36 5G, OnePlus Nord 5, OnePlus Nord CE5, iQOO Z10 Lite 5G, realme NARZO 80 Lite 5G, HONOR X9c 5G, OPPO Reno14 Series, LAVA Storm Lite 5G and iQOO 13, among others ● Avail up to 40% off on Smartphones and Accessories along with exciting offers such as Instant bank discounts, up to 24 months of No Cost EMI, Exchange offers worth up to INR 60,000 and many more. ● Get exciting deals on Samsung Galaxy S24 Ultra 5G, iPhone 15, OnePlus 13s, iQOO NEO 10R and many more flagship smartphones Consumer Electronics and Personal Computing Prime Day features top brands across multiple categories including laptops from HP, Dell, Lenovo, Apple, and Asus; tablets from Apple, Samsung, Lenovo, Xiaomi, and OnePlus; wearables from Samsung, Boat, Noise, Amazfit, and Fireboltt; headphones from Boat, Sony, Boult, JBL, and Bose; speakers from JBL, Boat, Bose, Zebronics, and Sony; and cameras from Sony, GoPro, Insta360, DJI, and Tapo ● Up to 80% off on electronics, accessories and headphones ● Up to 50% off on wearables, cameras and accessories along ● Up to 40% off on laptops and up to 60% off on tablets ● Up to 60% off on speakers Home Entertainment Bring home the cinema experience with big savings on large screen latest televisions. Shop from more than 600 latest TVs along with more than 55 Prime day special launches and avail exciting offers on top TV brands like Sony, Samsung, LG, TCL and Xiaomi: ● Up to 65% off on televisions with 10% instant bank discount, additional coupons, No Cost EMI options up to 24 months, extended warranty up to 3 years and exchange offers from top brands. ● Premium television entertainment starting at just ₹99 per day with additional savings up to ₹20,000 through combined coupon and bank offers, plus upgrade old for new with exchange offers up to ₹7,000 when trading in your existing television. ● Shop stress-free from 600+ television options with up to 4 years extended warranty, complimentary shipping and professional installation services included. Home Appliances Up to 65% off on home appliances from top brands including LG, Samsung, Haier, Godrej, and Carrier, with customers enjoying exchange discounts up to ₹17,000 and additional coupon discounts up to ₹5,000 on the latest energy-efficient refrigerators, washing machines, air conditioners, and other essential home appliances. ● Up to 60% off on washing machines from LG, Samsung, Bosch, IFB amongst others and air conditioners from Carrier, Daikin, Panasonic, LG and more ● Up to 55% off on refrigerators from Samsung, Haier, LG, Godrej amongst others and up to 50% off on dishwashers from Bosch, IFB, Faber and more ● Up to 65% off on chimney from Faber, Elica, Glen, Crompton amongst others and up to 60% off on microwaves from Samsung, LG, Haier and more
