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Business Times
a day ago
- Business
- Business Times
There's a ticking time bomb in Trump's ‘big, beautiful Bill'
THIRTY years ago, when I was a rookie reporter, a veteran writer offered me sage advice: whenever presented with a government or corporate document that is more than 100 pages long, hunt for hidden bombs. Donald Trump's thousand-page (plus) 'big, beautiful Bill' is a case in point. Since the House of Representatives passed it last week, this fiscal act has been (rightly) lambasted for many reasons: it favours the rich over the poor; cruelly cuts social safety nets; and recklessly expands the debt. Even Elon Musk is upset. But what investors should also fret about, if they care about the state of Treasuries or are a non-American entity holding US assets, is a clause buried in the bowels of this behemoth called section 899. This would enable the US Treasury to impose penalties on 'applicable persons' from 'discriminatory foreign countries' by increasing US federal income tax and withholding rates by up to 20 percentage points on their US investments, on a variable scale. It might thus be viewed as a novel 'revenge tax' (as some lawyers call it) that Trump could use to bully friends and foes alike in trade negotiations. So, at best, all this undermines prior efforts to build a collaborative global tax system via groups such as the Organisation for Economic Co-operation and Development, with its undertaxed profits rules. At worst, it makes Trump look like a feudal European king intent on using tax as a capricious tool to extract foreign tribute. Either way, it undermines the idea that America is a place of consistent investment laws – and has shocked lawyers in countries such as Canada. 'Section 899 is toxic (and) a potential game-changer for foreign investment,' Larson Gross, a tax advisory group, told clients this week. Or as Neil Bass, a Canadian lawyer wrote in his own missive: 'The US just declared a tax war and it's targeting allies.' George Saravelos, an analyst at Deutsche Bank, writes in a client note: 'Section 899 challenges the open nature of US capital markets by explicitly using taxation on foreign holdings of US assets as leverage to further US economic goals.' BT in your inbox Start and end each day with the latest news stories and analyses delivered straight to your inbox. Sign Up Sign Up So will this actually become law? The only honest answer (as with so much of Trump policy-making) is 'no one knows'. Trump's bark, after all, is often worse than his bite, and the courts sometimes rein him in, as seen with tariffs this week. Known unknowns In any case, there are a host of known unknowns around section 899. The Senate might insist that this clause is watered down or removed. Or if the surcharge stays intact, there may be provisions to let affected non-American investors and companies offset this against domestic tax bills. No one exactly knows how a 'discriminatory foreign country' will be defined (although the Treasury is supposed to regularly report on that). Nor is it entirely clear what investors and companies might be hit. At first glance, the Bill only affects non-US investors and companies already subject to US tax. But, as I recently noted, the White House recently warned in an executive order that it might overturn a crucial 1984 ruling that exempted Chinese investors, among others, from a prior 30 per cent withholding tax on assets such as US Treasuries. If so, those flows might be hit by section 899 too, as analysts such as Michael McNair suggest. Another reason for uncertainty is splits among Trump's own advisers. I am told that some love the idea of imposing revenge taxes on foreigners, since it will play well with the Maga base – and a think-tank allied with vice-president JD Vance reckons that such taxes could raise US$2 trillion revenue in the next decade. And figures such as Howard Lutnick, commerce secretary, are keen to find new weapons to wield in their trade negotiations with the EU and Canada. As the law firm Davis Polk points out, the fact that those two regions – along with the UK – impose digital services taxes could make them easy targets for section 899 measures. But Scott Bessent, Treasury secretary, is likely to be wary of invoking section 899 since he does not want to scare global investors away from Treasuries. After all, he needs to sell oodles of US government bonds to fund the ever-expanding debt – and there are already hints of some capital flight. Undermining global trust Either way, the key point is that the mere presence of section 899 in this Bill – whatever ultimately happens – is likely to further undermine global trust, given that it shows that the Trump team is at least entertaining the idea of turning trade wars into capital wars, in the future. No wonder investment groups ranging from Canadian pension funds to mighty Asian institutions tell me that they are stealthily diversifying away from US assets. Or that Federal Reserve officials recently fretted about the likely damage to America's economy if its 'safe haven' investment status is undermined. As legislative bombs go, this is self-defeating. The Senate should kick it away. FINANCIAL TIMES
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Business Standard
2 days ago
- Politics
- Business Standard
Trump gives Harvard 30 days to reply on foreign student enrolment ban
The Trump administration has given Harvard University 30 days to respond to a notice that could prevent it from enrolling foreign students, according to a report by Reuters. Harvard has said that losing the ability to admit international students would affect around one-fourth of its total student population. A federal judge is expected to review the matter today (May 29) and decide whether to continue blocking the Trump administration's move. Trump suggests cap on international students Speaking at the Oval Office on Wednesday, US President Donald Trump said Harvard should limit its intake of non-American students to 15 per cent. "Harvard has got to behave themselves," he said. Meanwhile, Harvard's legal team has argued that the removal of its certification was sudden and did not follow federal procedures. They pointed out that regulations require the department to provide a valid reason, give prior notice, and allow time for the institution to address any concerns. According to Department of Homeland Security rules, the agency was required to allow a 30-day period for responding to its claims and submitting supporting evidence. Trump-Harvard face-off The Trump administration has alleged that Harvard was encouraging antisemitism and violence on its campus, and collaborating with the Chinese Communist Party. 'Harvard is treating our country with great disrespect, and all they're doing is getting in deeper and deeper,' said Trump. In response, the University's legal team described the actions against it as an "unprecedented and retaliatory attack on academic freedom". Separately, Harvard is also involved in a legal case contesting the Trump administration's decision to withdraw $3 billion in federal research funding. What Trump's Harvard foreign student ban means for Indians Meanwhile, despite facing pressure and threats from the Donald Trump administration, Harvard University went ahead with its 374th commencement ceremony on Thursday, celebrating its graduating students. The keynote address was delivered by physician and author Abraham Verghese.
Time of India
2 days ago
- Business
- Time of India
Trump's $5 Million Gold Card Visa Plan: Why experts say it may never become a reality
The ambitious Trump Gold Card visa programme, touted as a potential economic gamechanger and a shortcut to U.S. residency for wealthy foreigners, may never move beyond a campaign concept, according to leading immigration experts and legal analysts. Despite high-profile endorsements and repeated declarations of an imminent rollout, the initiative currently lacks legal backing, operational structure, and a realistic applicant base, stakeholders have said, as mentioned in a report by Forbes. A Concept Without a Framework Marketed as a $5 million entryway into the United States—complete with residency rights, a citizenship track, and possible tax advantages—the Donald Trump Gold Card visa was introduced earlier this year by U.S. President Donald Trump and his ally, Commerce Secretary Howard Lutnick. The proposal suggests it could replace the existing EB-5 Immigrant Investor Program , which currently allows foreign nationals to gain residency through investments of $800,000 to $1 million and job creation requirements. However, immigration experts point out that no legislation has been introduced, nor are there details of a formal structure. 'There is no real programme, no enabling law—just a marketing pitch,' said Nuri Katz, founder of Apex Capital Partners, who has advised ultra-high-net-worth individuals on immigration for over three decades. Katz stressed that the U.S. Congress would have to enact new immigration and tax laws before any such programme could take effect. Live Events Trump's Vision: Ambitious but Impractical? President Trump has floated numbers as high as $50 trillion in potential revenue, claiming the sale of 10 million Gold Cards would more than erase the national debt. Lutnick has since tempered the projections, suggesting $1 trillion in revenue from 200,000 applicants. But analysts remain skeptical. 'The math simply doesn't support the vision,' Katz told reporters. 'In my experience, investors rarely commit more than 10% of their net worth to an immigration programme. So unless an individual is worth $100 million or more, they won't even consider this.' According to a Henley & Partners report, there are fewer than 30,000 non-American centimillionaires worldwide—far fewer than the figures being pitched by the administration. Legal and Technical Barriers Persist The programme's digital infrastructure has also drawn criticism. Although a website— expected to go live this month, visitors are instead met with a placeholder page and malfunctioning registration prompts. The Department of Commerce has not provided clarity on when or whether the site will officially launch. According to the American Immigration Lawyers Association, no U.S. President can unilaterally create or alter visa categories. The current EB-5 programme, reauthorized through 2027, would remain in place unless Congress amends existing law. Skepticism Mounts Among Wealth Managers Katz, who advises international clients, said he would not recommend participation to any investor under current conditions. 'Without legislation and regulatory clarity, even submitting personal information on a website could pose risks. We don't know where that data would end up,' he warned. In a telling moment, Katz dismissed Lutnick's recent claim that 1,000 Gold Cards were sold in one day—allegedly generating $5 billion—as 'implausible and unserious.' Origins in a Conversation, Not Policy The genesis of the Trump Gold Card idea reportedly came from hedge fund manager John Paulson, who suggested monetising visas during a conversation with Trump. 'Why do we give them away? We should sell them,' Paulson allegedly said, prompting Lutnick to develop the proposal. But translating a dinner-table idea into federal immigration policy, experts say, will require more than bravado and branding. FAQs What is the Trump Gold Card visa programme? It's a proposed visa initiative by U.S. President Donald Trump, offering U.S. residency and a path to citizenship to wealthy foreigners in exchange for a $5 million investment. Has the programme been officially launched? No. As of now, it remains a concept without a legal framework or legislative backing, according to immigration and legal experts. Economic Times WhatsApp channel )
Middle East Eye
3 days ago
- Politics
- Middle East Eye
'Are they troublemakers?': Trump questions why Harvard has so many international students
US President Donald Trump is demanding to see the "lists" of students enrolled at the prestigious Harvard University in Cambridge, Massachusetts, after he said he learned that nearly one-third of those studying there are international students. "Harvard has to show us their lists. They have foreign students. About 31 percent of their students are foreign-based. Almost 31 percent. We want to know where those students come [from]. Are they troublemakers?" he told reporters at the White House on Wednesday. Harvard maintains that only one quarter of its student body comes from abroad. "If somebody is coming from a certain country and they're 100 percent fine - which I hope most of them are, but many of them won't be - you're [also] going to see some very radical people," he added. Harvard, he claimed, is "taking people from areas of the world that are very radicalised, and we don't want them making trouble in our country." New MEE newsletter: Jerusalem Dispatch Sign up to get the latest insights and analysis on Israel-Palestine, alongside Turkey Unpacked and other MEE newsletters The New York Times reported this week that the administration is poised to cut all remaining federal contracts with Harvard, which are estimated to be worth an estimated $100m. The two sides have been in a legal war for months now after the university refused to submit to the administration's demands to produce the names and statuses of all its non-American students. The move came as the State Department and the Department of Homeland Security began cracking down on any pro-Palestinian sentiment expressed by student visa holders in the US, especially after the nationwide campus protests in 2024 for Gaza. Harvard did not acquiesce and was hit with a freeze of $2.3bn in federal funding in April, which represents 35.9 percent of Harvard's $6.4bn operating expenses. In response, the university sued the administration. The US Department of Health and Human Services then said that it was terminating $60m in federal grants to the university for failing to address antisemitic harassment and ethnic discrimination on campus. "I think they should have a cap of maybe around 15 percent, not 31 percent," Trump said on Thursday. "We have people [who] want to go to Harvard and other schools [and] they can't get in because we have foreign students there." "I want to make sure that the foreign students are people that can love our country. We don't want to see shopping centres exploding," he added. Last week, Harvard sued the Trump administration in federal court in Boston, Massachusetts, after its ability to enrol foreign students was revoked. Within hours, a federal judge ruled in Harvard's favour. 'Harvard has got to behave themselves. Harvard is treating our country with great disrespect, and all they're doing is getting in deeper and deeper and deeper," Trump said. "I want Harvard to be great again... so we have to look at the list, and Harvard has to understand. The last thing I want to do is hurt them. They're hurting themselves," he insisted. More visa restrictions While Harvard argues that the administration is clamping down on free speech protections, Secretary of State Marco Rubio on Wednesday said he was defending those protections by issuing new visa restrictions on "foreign nationals who are responsible for censorship of protected expression in the United States". "Even as we take action to reject censorship at home, we see troubling instances of foreign governments and foreign officials picking up the slack," he said in a statement. "In some instances, foreign officials have taken flagrant censorship actions against US tech companies and US citizens and residents when they have no authority to do so." The decision appears to stem from a feud between Brazilian Supreme Court judge Alexandre de Moraes and Trump confidante and CEO of social media platform X, Elon Musk. In a hearing before lawmakers last week, Rubio said he was reviewing possible sanctions against the judge. US sparks criticism online after halting student visa appointments and extending 'social media vetting' Read More » Moraes had demanded that social media accounts spreading disinformation related to Brazil's far-right former president, Jair Bolsonaro, be suspended on platforms like X and Rumble, a far-right video platform, or else the sites themselves would be blocked entirely. "It is unacceptable for foreign officials to issue or threaten arrest warrants on US citizens or US residents for social media posts on American platforms while physically present on US soil," Rubio said on Thursday. "It is similarly unacceptable for foreign officials to demand that American tech platforms adopt global content moderation policies or engage in censorship activity that reaches beyond their authority and into the United States. We will not tolerate encroachments upon American sovereignty," he wrote. Meanwhile, the Trump administration on Tuesday ordered a temporary suspension of foreign and exchange student visa appointments at its missions worldwide. This directive, detailed in an internal cable reviewed by Reuters and other news outlets, coincides with the State Department's preparations to enhance what it calls "social media vetting" of foreign students. Rubio communicated in the cable that revised guidelines on social media assessment for these visa categories are expected following a comprehensive review, advising consular sections to defer new appointments. All appointments already made will be honoured, while available appointments will be cancelled. "The Department is conducting a review of existing operations and processes for screening and vetting of student and exchange visitor (F, M, J) visa applicants, and based on that review, plans to issue guidance on expanded social media vetting for all such applicants," the cable said.
New York Post
3 days ago
- Business
- New York Post
Trump suggests 15% cap on foreign students at Harvard, says he wants Ivy ‘to be great again'
WASHINGTON — President Trump suggested Wednesday that Harvard halve its number of international students to make the prestigious university 'great again' — after halting billions in federal grants and trying to throttle the Ivy League institution's ability to enroll foreigners. 'I think they should have a cap of maybe around 15%, not 31%. We have people who want to go to Harvard and other schools, [but] they can't get in because we have foreign students there,' Trump told reporters in the Oval Office. The administration last month froze $2.2 billion in federal funding to the elite university and last week paused its ability to enroll international students — after college leaders rebuffed administration demands to curtail antisemitic incidents and provide lists of foreign students for federal review. Advertisement 3 Graduating students hold Palestinian flags and chant as they walk out in protest over the 13 students who have been barred from graduating due to protest activities, during commencement in Harvard Yard, at Harvard University, in Cambridge, Mass., Thursday, May 23, 2024. AP 3 New York Post cover for Wednesday, May 28, 2025 'Harvard is treating our country with great disrespect,' Trump added. 'I want Harvard to be great again.' The president also floated rerouting federal funds to trade schools and away from the Cambridge institution, which says 27.2% of its student body in the 2024-2025 academic year was non-American. Advertisement 'They're taking $5 billion and I'd rather see that money go to trade schools. And by the way, they're totally antisemitic at Harvard, as you know, and some other colleges too, in all fairness to them, and it's been exposed, very exposed,' Trump said. 3 Demonstrators gather on Cambridge Common to protest Harvard's stance on the war in Gaza. AFP via Getty Images 'Every time they fight, they lose another $250 million. Yesterday we found another $100 million. And they have, you know, they have a fund, an endowment, $52 billion, all right? They got a lot of that from the United States. And I think it's ridiculous.' Trump added: 'Everyone's coming up to me saying, 'We love the idea of trade schools, with that kind of money … you can have the best trade schools anywhere in the world.'
