Latest news with #budgetproposals
Fox News
3 days ago
- Business
- Fox News
Republican senators roll out DOGE budget proposals for Trump's 'big, beautiful bill'
EXCLUSIVE: A group of DOGE-minded lawmakers is rolling out a series of budget proposals to add to the Senate version of the One Big Beautiful Bill Act narrowly passed by the House. The effort, led by Senate DOGE Caucus Chairwoman Joni Ernst, will include several major proposals forged by Republicans from both chambers, seeking to help offset trillions in extant government spending. While a $9.4 billion rescissions package, a formal request from the executive branch to codify its DOGE cuts, is in the works, proponents of the Senate DOGE package say their total estimated savings would accentuate that and also surpass it in value. "We have a 'big, beautiful' opportunity to reduce reckless spending and save billions of dollars," Ernst told Fox News Digital Thursday. "Defunding welfare for politicians, stopping bogus payments and ending unemployment for millionaires are just the start of my commonsense solutions to continue rooting out waste, fraud and abuse. Washington has lived high on the hog for far too long, and now is the time to tighten the belt," the Senate DOGE chairwoman added. Senate DOGE addendums to the Big Beautiful Bill Act during negotiations will include a plan from Ernst called the ELECT Act, which she said claws back hundreds of millions of dollars treated as "welfare for politicians." While $320 million from the fund was diverted to the Secret Service last year, the current $17 million sitting in the account is expected to rise to the $400 million it typically sat at by the end of the year, Fox News Digital has learned. Partnered in that first piece of the DOGE package is also language stripping former presidents of certain perks like additional taxpayer-funded office space and non-security-related staff. More than a dozen Senate Republicans also signed onto that portion of the package. "The federal government must be held accountable for every tax dollar spent," said co-sponsor Mike Lee of Utah. House DOGE Caucus Chair Aaron Bean, R-Fla., also contributed to the package. The Senate version of his DOGE in Spending Act will be included in Senate negotiations. That portion requires any government expenditure to be accompanied by a tangible record to be provided to the Treasury after DOGE found $160 billion in taxpayer funds being distributed without an identification code or in a fraudulent manner. "The American people deserve a government that is efficient, accountable and fiscally responsible. That's why the House successfully advanced DOGE reforms through reconciliation that will safeguard America's financial future," Bean told Fox News Digital. "I encourage the Senate to build on the work we've done in the House to deliver lasting fiscal responsibility to the American people." Other pieces of the Senate's DOGE package include ending what proponents call "unemployment for millionaires," disqualifying people earning more than $1 million per year who lose their jobs from any unemployment support. More than $271 million had been disbursed to that bloc between 2021-2023, proponents said. Rep. Scott Perry, R-Pa., a former chairman of the conservative House Freedom Caucus, is leading the Protecting Taxpayers' Wallet Act in the lower chamber. The bill's language, which ends taxpayer-funded union time when government workers negotiate their contracts while on the clock, will be included in the Senate DOGE package. Another portion will compel the sale of six unused or underutilized federal buildings in Washington, D.C., that lawmakers say would free up $400 million in savings annually. The final portion will "snap back inaccurate SNAP payments," Ernst said. The effort will work to identify errors, force collection of overpayments to SNAP recipients and hold states with high levels of their own payment inaccuracies accountable for their negligence. In 2023, approximately $11 billion in SNAP funds were overpaid, but the package's authors noted individual errors of $54 or less aren't included in the tally. Democrats have been critical of DOGE efforts and the separate rescissions package. Sen. Chris Coons, D-Del., told Fox News Thursday a successful version of the latter hasn't passed since the first Bush administration. "Congress' role in setting spending would be done away with, so this first rescission should be defeated," he said.
Telegraph
22-05-2025
- Business
- Telegraph
Angela Rayner's leaked memo: read in full
The revelation that Angela Rayner sent a secret memo to Rachel Reeves pressing for tax rises instead of spending cuts has triggered a firestorm in Westminster. Here, The Telegraph publishes the note in full, allowing readers to see all the details of what was being proposed by the Deputy Prime Minister behind closed doors. The memo was submitted in mid-March before Ms Reeves, the Chancellor, unveiled her Spring Statement on March 26. Ten proposals are made: eight tax rises and two benefit changes. It reveals a split at the very top of Government on economic strategy. Ms Reeves ignored the proposals for her Spring Statement, but it is yet to be seen what makes her Autumn Budget. ALTERNATIVE PROPOSALS FOR RAISING REVENUE This note sets out ten proposals that would be popular, prudent, and would not raise taxes on working people. There are also some more radical and new proposals that may be more difficult to implement and/or contentious - but which would be worthy of careful consideration: 1. Raise the bank surcharge to 5% ● When corporation tax increased in April 2023, the previous Chancellor cut the banking surcharge paid by banks on profits from 8% to 3% as an offsetting measure. Reinstating the surcharge at 8% could be worth £1.5bn a year, based on the OBR forecasts from the time of the cut, though clearly this could create competitiveness risks. However, even a smaller increase of the surcharge to 5% could still raise £500-700m a year and only take the rate of tax paid by banks on their profits back to the 2008 levels of c.30%. 2. Remove Inheritance Tax (IHT) Relief for AIM Shares completely ● Shares designated as 'not listed' (notably AIM shares) receive 50% relief (reduced from 100% relief at Autumn Budget). Removing the relief completely for AIM shares could raise between £100m-1 billion per year. External tax expert, Dan Neidle, argued in favour of such a change, saying, 'AIM yields are currently depressed by market valuations driven by the tax benefit, not fundamentals. This is an unhealthy state for any market to be in.' 3. Remove the dividend allowance ● Tax is not paid on dividend income that falls within your income tax Personal Allowance. There is also a £500 dividend allowance each year. You only pay tax on any dividend income above this. It was reduced from £2,000 to £500 over the past few years but removing it altogether would be worth £325 million a year, according to HMRC data. 4. Freeze the additional rate income tax threshold ● The additional rate of income tax (45%) applies to income above £125,140. The Chancellor has announced that income tax thresholds will remain frozen until 2028 before being uprated. Continuing to freeze the additional rate threshold in cash terms rather than uprating it with inflation from April 2028 could raise revenue and would be consistent with the manifesto. 5. Annual Tax on Enveloped Dwellings. ● The Annual Tax on Enveloped Dwellings could be increased. Our main arguments to increase this tax are that (i) we are leaving money on the table by setting it too low, potentially c.100-200m a year; and (ii) the people who pay it are nearly exclusively living in big homes in exclusive London postcodes (over 8 in 10 are in London and over 7 in 10 in Westminster or Kensington and Chelsea). 6. Close the commercial property stamp duty loophole ● Stamp duty on commercial property purchases is up to 5% - but a lot of transactions place the property in an offshore company and sell the shares in the company, in order to pay no stamp duty. This is an obvious loophole, impossible to explain to the public, and external experts estimate closing it could raise up to £1 billion a year from the commercial property market. 7. Move higher and additional rate Dividend Taxes closer to Income Tax: ● Both the higher and additional rates of dividend taxes are set lower than income tax - Higher rate: 33.75% (vs. 40%); and (iii) Additional rate: 39.35% (vs. 45%). Whilst HMT would need to consider the implications for investment, it is worth considering whether closing this gap could raise significant income and provide a logical alignment of the tax system. 8. Reinstate a pensions lifetime allowance: ● In March 2023, then Chancellor Jeremy Hunt announced the abolition of the pensions lifetime allowance. The lifetime allowance was a limit on the total value an individual's private pensions could reach before high tax rates were applied. One option would simply be to reinstate the lifetime allowance at around its previous level of £1,073,100. Costing such a reform is difficult, but given that the OBR's assessment was that abolishing the allowance cost £800 million a year, reversing it might be expected to raise almost as much. Another option would be new higher lifetime allowance, for example the last Labour government set the lifetime allowance at £1.8 million in April 2010, although that would raise less than the 800m. Two additional proposals are worth potential consideration but would be more contentious, and potentially take longer to deliver or implement: 9. Reverse the changes to the High Income Child Benefit charge. ● High Income Child Benefit Charge provides for Child Benefit to be clawed back through the tax system from families where the highest earner has an income above a set threshold. At Spring Budget 2024, the previous government increased the threshold from £50,000 to £60,000 and made changes to the taper rate - as a result the system was made more generous to families, with their child benefit only withdrawn completely when their income reaches £80,000. These two changes were forecast to cost c.600m a year, which could be saved if they were reversed on the grounds that they added to the welfare budget without being properly funded. 10. Tighten migrant access to the welfare system: ● Migrants who have spent 5-10 years in the UK generally receive access to a broad range of welfare entitlements. Indefinite leave to remain in the UK confers access to core welfare entitlements such as Universal Credit, and 10 years of National Insurance contributions confers eligibility for some state pension provision. Those who arrived in the UK during the period of very high immigration in the past few years will become eligible for indefinite leave to remain over the course of this Parliament. ● The Spring Statement could announce a review of entitlements with a target saving to be delivered in time for the Spending Review or Autumn Budget, and include Universal Credit and state pension entitlements. The review could also consider whether further rises in the Immigration Health Surcharge should be implemented (currently set at £1,035 and raising c£1.7bn a year). DHSC figures shows that this only just covers the estimated average annual cost of treating migrant patients.
