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<keyword id="19945815" type="General" weightage="20" keywordseo="startups" source="keywords">Startups</keyword> in <keyword id="19895063" type="General" weightage="20" keywordseo="India" source="keywords">India</keyword> have high expectations from this year's upcoming <keyword id="19908389" type="General" weightage="20" keywordseo="Union-Budget" source="keywords">Union Budget</keyword>. Early-age startups hope for the removal of angel taxes, while <keyword id="20677283" type="General" weightage="20" keywordseo="health-tech-startups" source="keywords">health tech startups</keyword> expect increased <keyword id="19913964" type="General" weightage="20" keywordseo="funding" source="keywords">funding</keyword> for the sector. Startups function as engines of economic growth, playing a crucial role in generating new jobs, ideas, products, and services. As of December 2023, the Department for Promotion of Industry and Internal Trade (DPIIT) had recognised 1,17,254 startups. These startups have reportedly created over 12.42 lakh direct jobs, significantly impacting the economy. Eklavya Gupta, CEO and Co-founder of Recur Club, stated, "We are confident that India's business credit landscape is on the brink of a major digital overhaul. FinTechs are at the forefront of this change, deploying innovative technologies and utilising in-depth data analytics to streamline and expand <keyword id="20974354" type="General" weightage="20" keywordseo="credit-access" source="keywords">credit access</keyword>." He added, "While the current allocation of Rs 10,000 crore is an excellent initial step, realising the full capabilities of India's SME and startup ecosystem will necessitate greater investment, especially in credit guarantee schemes." Vinod K Singh, Co-Founder and CTO of Concirrus, expressed his expectations from the budget: "As the Union Budget 2024-25 approaches, we hope the government will address the pressing issue of the 'angel tax.' Eliminating this tax will enhance capital formation and attract vital <keyword id="19895633" type="General" weightage="20" keywordseo="investments" source="keywords">investments</keyword>. Streamlining the duty structure and reducing high tariffs on electronic inputs are also crucial to bolstering the startup ecosystem and driving innovation. Expanding the Fund of Funds and introducing low-interest loans would be beneficial." Rajiv Lamba, co-founder and CEO of AI-enabled customer feedback platform Surveysensum, added, "Just as the government has prioritised financial inclusion, it should now focus on <keyword id="22405441" type="General" weightage="20" keywordseo="technological-inclusion" source="keywords">technological inclusion</keyword> to propel India to the next stage of growth. By training youth in AI, the government can make a strategic investment in the nation's technological future. Given the rapidly evolving job market, a substantial increase of 20 to 25 percent in budget allocation should be considered for AI-based skill development and entrepreneurship." He further emphasised, "Incentivizing investment in <keyword id="20328842" type="General" weightage="20" keywordseo="AI-startups" source="keywords">AI startups</keyword> and R&amp;D initiatives can boost local innovation in the AI space. The last budget introduced a deep tech fund of Rs 1 lakh crore with a 50-year interest-free loan period; the government should now establish a clear and transparent mechanism for access to this fund." Raja S, founder and MD of Hearzap, highlighted the expectations of health tech startups: "Health tech startups are eagerly anticipating increased funding that could usher in transformative advancements. This crucial investment holds the promise of extending cutting-edge healthcare solutions to rural and underserved areas, effectively bridging existing gaps in care. The upcoming budget ensures that every individual in our diverse population, from the youngest to the oldest, can access essential health services, including specialised care." Discussing taxation for startups in India, Vvihan Gulati, Director of Mediagraphics PR, commented, "Removing the angel tax is a highly anticipated move that would benefit early-stage startups and their investors. It would foster a more favourable environment for innovation and growth, allowing startups to attract much-needed capital without the burden of excessive taxation. This change could significantly enhance the ease of doing business and contribute to the overall growth of the startup ecosystem in India." The Union Budget 2024 will be tabled on July 23 by Union Finance Minister Nirmala Sitharaman. With this, she will become the first Finance Minister to deliver seven consecutive budgets, surpassing Morarji Desai. She presented the interim budget on February 1 of this year.

Startups demand angel tax elimination, incentives on investments in upcoming budget

<ul class="summary-list"><li>Director Richard Linklater told Texas Monthly that "Hit Man" was originally set in Houston.</li><li>According to a consultant for the film, the location was moved to New Orleans for a tax incentive.</li></ul>The setting of "<a target="_blank" href="https://www.businessinsider.com/netflixs-hit-man-ending-explained-true-story-2024-6">Hit Man</a>" was changed from Houston to New Orleans because of tax incentives, according to a report by Texas Monthly."Hit Man," Netflix's latest comedy, is based on a 2001 article by <a target="_blank" href="https://www.businessinsider.com/texas-monthly-hollywood-film-tv-true-crime-netflix-deal-2023-10">Texas Monthly</a> writer Skip Hollandsworth about Gary Johnson, an undercover hitman who operated in Houston.<a target="_blank" href="https://www.businessinsider.com/hit-man-fact-vs-fiction-true-story-accurate-2024-6">Johnson</a>, who died in 2022, pretended to be a professional killer so that he could catch people trying to hire one.The film version makes a few alterations to Johnson's story, including changing the location to New Orleans in neighboring Louisiana.Earlier this month, <a target="_blank" href="https://www.texasmonthly.com/arts-entertainment/richard-linklater-hit-man-theater-interview/">Texas Monthly</a> published an interview between Hollandsworth, a consultant on the movie, and "Hit Man" director Richard Linklater.During the interview, Hollandsworth said the production was moved to New Orleans because "at the time, there were zero tax incentives to shoot in Texas."Linklater replied: "It was set to be a real Houston movie, with all of Houston's eccentricity. But our state thought otherwise, so off we went to New Orleans, which is even more humid than Houston, I found out."<div type="image" title="Glen Powell and Richard Linklater promoting &quot;Hit Man&quot; in 2024." height="1737" width="2317" msid="110877679" hostid="261" sizebytes="195652"></div>Louisiana's Motion Picture Production Tax Credit <a target="_blank" href="https://filmneworleans.org/tax-incentives/">program</a> gives up to a 40% tax credit on in-state spending on movie productions. A 25% base credit is given for all productions, which is likely the incentive that "Hit Man" received.Linklater told Texas Monthly that the film cost $10 or $11 million to make, which means the production likely saved a lot from moving to New Orleans. The film was produced independently and bought by <a target="_blank" href="https://www.businessinsider.com/netflix-streaming-fewer-original-movies-worries-filmmakers-box-office-struggles-2024-1">Netflix</a> in September 2023 for $20 million.Over the past decade, <a target="_blank" href="https://www.businessinsider.com/personal-finance/state-income-tax-rates">Texas</a> has struggled to compete with its neighboring states' incentive programs to attract film productions.Texas' program works differently — it isn't a tax credit but it gives a percentage of a production's spending back to the producers.After 2013, when Texas spent $95 million on the program, legislators began cutting the budget down and proposing bills to get rid of the incentive program entirely.Janis Burklund, the director of the Dallas Film Commission, told <a target="_blank" href="https://www.dmagazine.com/arts-entertainment/2017/01/how-lawmakers-will-try-to-kill-texas-film-incentives-legislature/">D Magazine</a> in 2017 that the cuts made it harder to attract big projects and could push homegrown talent to leave the state."Texas is losing a lot of jobs because we can't compete," she said.In 2023, Texas reversed this decision, passing a bill that allocated $200 million to the incentive program.That boost, combined with the success of TV series filmed in the state like "<a target="_blank" href="https://www.businessinsider.com/what-yellowstone-locations-look-like-in-real-life-versus-show-2023-1">Yellowstone</a>," could bring film productions back to Texas.

'Hit Man' was meant to be set in Houston, but switched to New Orleans because of tax incentives

<ul class="summary-list"><li>Missouri's Kansas City Chiefs are pushing for a move across state lines.</li><li>The NFL team wants Kansas to approve a tax incentive that would fund a brand-new stadium in the state.</li></ul>The Kansas City Chiefs may be on the move.Kansas lawmakers are gathering this week for a <a target="_blank" href="https://www.kslegislature.org/li_2024s/">special legislative session</a> and could vote on a bill that would give millions in tax incentives to expand the state's tourism and entertainment industries.All eyes are now on the bill, which, if passed, could help the reigning Super Bowl champions (as well as the MLB's Kansas City Royals) move from Missouri's Kansas City to Kansas'.At a hearing on Monday ahead of the formal start of the session, representatives for the Kansas City Chiefs and the Royals asked Kansas lawmakers to pass the bill, <a target="_blank" href="https://missouriindependent.com/2024/06/17/chiefs-royals-ask-kansas-for-incentives-to-allow-teams-to-leave-missouri/">the Missouri Independent reported</a>.That legislation would give the teams hundreds of millions of dollars to help fund building new stadiums in Kansas."If we want to be major league, we've got to have major-league teams," Korb Maxwell, an attorney who represents the Chiefs, told lawmakers on Monday, according to the Missouri Independent. "This is the greatest opportunity we've had in any generation, and it's here before us right now."The proposed legislation would strengthen the state's Sales Tax and Revenue Bonds program and let Kansas provide bonds that would pay for up to 70% of the cost of building brand-new stadiums for one or both of the sports teams, <a target="_blank" href="https://www.kansascity.com/news/politics-government/article289346295.html">The Kansas City Star reported</a>.Under the bill, the teams would be required to spend at least $1 billion on the new stadiums and training facilities, the Missouri Independent reported.The state would pay off the bond given to the teams over 30 years using sports-gambling and lottery money, The Kansas City Star said.Meanwhile, Missouri legislators are fighting to keep the Chiefs for themselves. Officials in Jackson County, Missouri, on Monday proposed a resolution for a countywide sales tax, the <a target="_blank" href="https://www.kshb.com/news/local-news/stadium-plan/as-kansas-looks-to-lure-chiefs-royals-jackson-county-looks-to-take-another-swing-to-keep-chiefs">local Kansas City, Missouri, outlet KSHB reported</a>. Depending on how much the tax is — the current options are each just a fraction of a cent — it would either pay for capital improvements to the Chiefs' existing stadium or building a brand-new stadium in Missouri, according to the outlet.The Chiefs' current home at the <a target="_blank" href="https://www.chiefs.com/stadium/concepts#:~:text=For%20more%20than%2050%20years,was%20elevated%20with%20its%20construction.">50-year-old Arrowhead Stadium</a> is in need of some improvement since it was last renovated in 2010.The team's president, Mark Donovan, said last summer the team was looking into three options: renovating the existing stadium, building a new one on-site, or moving to a new location entirely, <a target="_blank" href="https://www.si.com/nfl/chiefs/news/kc-chiefs-president-details-plans-for-arrowhead-stadium-future">Sports Illustrated reported</a>.And in 2022, Donovan even floated the idea of moving from Missouri to Kansas, according to the outlet.Proponents of the move argue that if something isn't done to keep the Chiefs and the Royals local to either Kansas City, the teams could choose to leave the Kansas-Missouri region altogether — a development that could <a target="_blank" href="https://www.businessinsider.com/taylor-swift-travis-kelce-relationship-timeline-photos-2023-10">devastate local Taylor Swift fans</a>.Representatives for the Kansas City Chiefs and Royals did not immediately respond to a request for comment.Correction June 18, 2024: A previous version of this story inaccurately described the two Kansas Citys. While both are part of the Kansas City metropolitan area, Kansas City, Missouri, and Kansas City, Kansas, are separate cities.

The Kansas City Chiefs want millions in tax incentives so the team can switch states

<ul class="summary-list"><li><a target="_blank" class="" href="https://www.businessinsider.com/tesla">Tesla</a> stands to benefit from any removal of consumer tax credits on electric vehicle purchases.</li><li>The move could hurt competitors more, CEO Elon Musk said.</li></ul><a target="_blank" class="" href="https://www.businessinsider.com/elon-musk">Elon Musk</a> supports a Trump plan to end tax credits of up to $7,500 for electric vehicle purchases.That might sound confusing: Why would the CEO of Tesla want to end a program that makes it cheaper for people to buy EVs?Well, according to Musk, it would devastate Tesla's rivals. And Tesla wants to keep its strong lead in the US EV market, which recently slipped under 50% for the first time."I think it would be devastating for our competitors and for Tesla slightly," Musk said in a July earnings call, predicting the impact of the tax credits ending. "But long term probably actually helps Tesla, would be my guess."On Thursday, Reuters reported that Trump plans to end the EV tax credit, with support from Tesla representatives. In a related post on X, Musk called for an "end all government subsidies, including those for EVs, oil and gas."Tesla has had a longer time than some of its rivals to <a target="_blank" class="" href="https://www.businessinsider.com/elon-musk-list-government-subsidies-tesla-billions-spacex-solarcity-2021-12">benefit from government subsidies</a>. Its market lead is well established, and it has led an EV pricing war that has squeezed its rivals, making it harder for them to survive if consumer demand falls even further.Put simply: Tesla wins if ending the tax credit pressures smaller rivals enough to stall their growth or even fold.<h2 id="91842e59-2373-4c08-abdd-17185b0bea0d">Tesla sells more EVs than anyone else, and more profitably</h2>In the third quarter of 2024, Tesla <a target="_blank" class="" href="https://digitalassets.tesla.com/tesla-contents/image/upload/IR/TSLA-Q3-2024-Update.pdf">reported</a> a pre-tax profit margin of 18%, well above the industry average of around 9%. Ford, the only competitor to break out its EV-specific finances, <a target="_blank" class="" href="https://s201.q4cdn.com/693218008/files/doc_financials/2024/q3/Press-Release-Ford-2024-Q3-Earnings.pdf">reported</a> a -104% margin for its Model e unit.Yet many of Tesla's vehicles are also priced well below many competitors. The Model 3 starts at $42,490 (after a cheaper option disappeared earlier this year). That's well below the average EV price in the US, which held steady at nearly $57,000 in October, according to Kelley Blue Book data.In an effort to juice sales, <a target="_blank" class="" href="https://www.businessinsider.com/tesla-can-make-cars-cheaper-than-competitors-2024-6">Tesla has drastically cut prices</a> on many of its cars over the past year, instigating an industry-wide price war that has cut into its own margin in pursuit of maintaining its industry-leading market share. Of the nearly 600,000 EVs sold in the US in the first half of 2023, <a target="_blank" class="" href="https://www.coxautoinc.com/wp-content/uploads/2024/07/Q2-2024-Kelley-Blue-Book-Electric-Vehicle-Sales-Report.pdf">half</a> were made by Tesla. Ford, in second place, accounted for just over 7% of EVs sold in the same period."While losing the EV tax credit could also hurt some demand on the margins in the US, this will enable Tesla to further fend off competition from Detroit as pricing/scale/scope is an apples to oranges when compared to the rest of the auto industry once the EV tax credit disappears," Dan Ives, a longtime bullish analyst at Wedbush, told clients in a note on Thursday.<h2 id="c6cefac7-9186-47f8-8f0a-f2fb65808785">Tesla is ahead of the curve in building a US manufacturing presence</h2>Eliminating the <a target="_blank" class="" href="https://www.businessinsider.com/federal-state-electric-car-vehicle-tax-credits-rebates-qualify">consumer tax credit</a>, part of President Joe Biden's Inflation Reduction Act, would need congressional approval. It's not yet clear if Trump and the incoming Republican-controlled Congress would also target other IRA tax incentives, like those supporting domestic manufacturing of cars, batteries, and other components. Competitors like BMW, Honda, and Hyundai have <a target="_blank" href="https://techcrunch.com/2024/07/20/tracking-the-ev-battery-factory-construction-boom-across-north-america/">raced</a> to scale up factories state-side to take advantage of those credits.Tesla has been ahead of this curve in manufacturing, too, with six US factories churning out cars and batteries. That work has paid off, and many Tesla models are regularly named as the most "<a target="_blank" href="https://www.cars.com/american-made-index/">American-made</a>" compared to competitors, many of which rely on factories in Mexico. In fact, only one other American automaker even cracked the top 10 in 2024.Tesla CFO Vaibhav Taneja said in a July earnings call that the company has taken advantage of manufacturing credits, but "we always drive ourselves to say, OK, what if there is no IRA benefit? And how do we operate in that kind of an environment? Like Elon said, we definitely have a big advantage as compared to our competition on that front."In October, the Alliance for Automotive Innovation, an industry group representing Ford, GM, Honda, Toyota, and others, <a target="_blank" href="https://subscriber.politicopro.com/article/2024/11/auto-trade-group-to-gop-tax-writers-keep-bidens-ev-credits-00189430">urged</a> Congress to keep the tax credits.The tax credits, including those for commercial leasing and manufacturing, are "critical to cementing the US as a global leader in the future of automotive technology and manufacturing," they said in an October letter to Congress published by <a target="_blank" href="https://subscriber.politicopro.com/f/?id=00000193-277d-dea7-afbb-b77f708f0000">Politico</a>.The group, which does not include Tesla, did not respond to a request for comment. A spokesperson for the Trump transition team did not respond to a request for comment.While Musk supports cutting the EV tax credit, reports of its potential demise appear to have spooked investors. Tesla shares fell about 5% following the Reuters report, while Rivian shares fell 11%.Musk and other Tesla leaders have long said autonomous vehicles are the future of Tesla, not just EVs, and encouraged potential investors to think much more long-term.Additional reporting by Benjamin Zhang.

Why Musk supports Trump getting rid of EV tax credits

<ul class="summary-list"><li>EV stocks fell on Wednesday after a report said President-elect Trump plans to cut EV tax credits.</li><li>The $7,500 tax credit was part of Biden's Inflation Reduction Act, put into place in 2022.</li></ul>Electric vehicle stocks dropped on Wednesday after a report said President-elect Donald Trump's transition team is looking at doing away with the EV tax credit. According to a report from <a target="_blank" class="" href="https://www.reuters.com/business/autos-transportation/trumps-transition-team-aims-kill-biden-ev-tax-credit-2024-11-14/">Reuters</a>, Trump's transition team has drawn up plans to end the $7,500 consumer tax credit for electric vehicle sales as part of broader tax reform legislation.<a target="_blank" class="" href="https://markets.businessinsider.com/stocks/tsla-stock">Tesla</a> stock dropped 5% to $312.20 a share following the report. Shares of <a target="_blank" class="" href="https://markets.businessinsider.com/stocks/rivn-stock">Rivian</a> plunged 12% to $10.57, and <a target="_blank" class="" href="https://markets.businessinsider.com/stocks/lcid-stock">Lucid</a> dropped 3% to $2.11 a share.Ending the tax credit—a key measure included in Biden's 2022 <a target="_blank" class="" href="https://www.businessinsider.com/house-passes-inflation-reduction-act-sending-it-to-biden-2022-8">Inflation Reduction Act</a>—would likely hurt EV sales, but sources told Reuters that Tesla representatives supported ending the subsidy. Tesla CEO Elon Musk has become a strong ally of Trump in recent months, supporting his campaign with sizable donations and spending time with him at his Mar-a-Lago residence.Musk has said previously that while ending federal tax incentives for EV purchases would hurt Tesla sales, the move would be more damaging to Tesla's US EV competitors, including General Motors and Ford. <a target="_blank" class="" href="https://markets.businessinsider.com/stocks/gm-stock">General Motors</a> stock jumped about 1% on Wednesday, while <a target="_blank" class="" href="https://markets.businessinsider.com/stocks/f-stock">Ford</a> shares were about flat.Reuters noted that the tax credit is likely an easy target. Other pieces of the Inflation Reduction Act could be hard to roll back, as the money for many programs has already been distributed. Eliminating the tax credit would likely garner wide support from Republicans and help offset the costs of future tax cuts.

EV makers slide on report Trump wants to scrap EV tax credit

<ul class="summary-list"><li><keyword id="22159313" type="General" weightage="20" keywordseo="Mississippi-County" source="keywords">Mississippi County</keyword> offers up to $50,000 for new home builds or renovations to attract residents.</li><li>The Work Here, Live Here program aims to boost the local economy and grow the population.</li></ul>Mississippi County, Arkansas wants to help residents build their <a target="_blank" href="https://www.businessinsider.com/buying-a-home-new-construction-shortage-supply-mortgage-rates-housing-2024-6">dream home</a>, as long as they agree to live in the area for at least four years. To accomplish this goal, it's offering up to $50,000 per household for a new home. The program — called Work Here, Live Here — is the county's effort to <a target="_blank" href="https://www.businessinsider.com/cities-that-pay-people-cash-money-to-move-there-2024-6">boost the local economy and grow the population</a>, which is just under 40,000 people, per the <a target="_blank" href="https://datacommons.org/place/geoId/05093?utm_medium=explore&amp;mprop=count&amp;popt=Person&amp;hl=en">2022 Census</a>. A two-and-a-half hour drive from Little Rock, the county borders Tennessee and includes cities like Blytheville and Osceola. Work Here, Live Here is organized and partially-funded through a group ofMississippi County industries, community groups, and financial institutions like Farmers Bank &amp; Trust. It first started providing resident and mover incentives in the fall of 2022. The county is one of the nation's<a target="_blank" href="https://markets.businessinsider.com/news/x"> top steel-producing areas</a>, President and CEO of Farmers Bank &amp; Trust Randy Scott told Business Insider. And, the incentive program is only available to employees of specific companies, like steel producers River Steel, US Steel, and Atlas Tube. Eight companies have partnered with Work Here, Live Here so far, and Scott expects more to join this month. "We want homeowners that are gonna stay here," Scott said. Mississippi County's incentive program is part of a recent wave of efforts across <keyword id="22159319" type="General" weightage="20" keywordseo="rural-America" source="keywords">rural America</keyword> to increase populations and local businesses. Areas like <a target="_blank" href="https://www.businessinsider.com/get-paid-move-work-remotely-cash-stipend-internet-kansas-2024-5">Lincoln County, Kansas</a>, <a target="_blank" href="https://www.businessinsider.com/left-washington-dc-moved-to-tulsa-remote-program-live-alone-2023-11">Tulsa, Oklahoma</a>, and Columbus, Georgia are paying people to move there, offering perks like discounted gym memberships, internet credits, tax breaks, and up to $10,000 in cash to new residents. Mover incentive programs have become especially popular in the aftermath of the pandemic, as <a target="_blank" href="https://www.businessinsider.com/dream-job-in-office-work-full-time-flexibility-benefits-2024-3">more jobs are remote or location flexible</a>. And, as the cost of living continues to rise in US cities — <a target="_blank" href="https://www.businessinsider.com/how-much-food-healthcare-housing-cost-most-expensive-us-cities-2024-2">especially on the coasts</a> — more prospective homebuyers are being priced out. Some are turning to these smaller cities and counties<a target="_blank" href="https://www.businessinsider.com/midwest-movers-gen-z-millennials-renters-single-california-texas-2024-2"> in the Midwest or South</a>. For Mississippi County, this growing housing demand has provided an opportunity to build their towns and cities. "They're going to be here for generations to come," Scott said. "They're your future registered voters, future school board members, future enrollments in the schools." <h2>With <keyword id="22159315" type="General" weightage="20" keywordseo="housing-incentives" source="keywords">housing incentives</keyword>, Mississippi County hopes to see population growth</h2>In the 20 months since Work Here, Live Here launched, the program has drawn 80 new homeowners to Mississippi County. And, according to Scott, the majority of them are <a target="_blank" href="https://www.businessinsider.com/house-affordability-crisis-13-young-americans-rely-family-down-payments-2024-3">first-generation homebuyers</a>, young people, and young families. The housing incentive program offers a 10% forgivable loan on a new <keyword id="22159321" type="General" weightage="20" keywordseo="home-construction" source="keywords">home construction</keyword> with a maximum home cost of $500,000, meaning some families can receive up to a $50,000 housing credit. Existing homes can receive a forgivable loan of up to 5%. Per data provided to BI fromWork Here, Live Here, the program has already led to the construction of 28 homes and 52 existing homes. The average price of homes purchased is $270,253 and the average benefit received is $28,767. "We will have an individual that gets the incentive," Scott said. "And within a week, everyone that works on his shift with him is calling us saying 'hey, how can I participate as well?"' Work Here, Live Here was initially focused on keeping residents who already lived in Mississippi County, but it has also attracted homebuyers from out of state, Scott said. Participants have come from Missouri, Alabama, Mississippi, Wisconsin, Michigan, Colorado, and Ohio. As more families move to or settle in Mississippi County, Scott expects it will have a positive effect on businesses, the school system, and public spaces. Now, he and other northeast Arkansas leaders want to get the word out. "Once we start having population increase — and there's no reason why we shouldn't with other jobs we have created — the quality of life will follow," Scott said. "You'll get the restaurants, you'll get the retail shops, you'll get the amenities." Have you been paid to move? Are you open to sharing your pros and cons of moving to a new city? If so, reach out to this reporter at <a target="_blank" href="mailto:allisonkelly@businessinsider.com">allisonkelly@businessinsider.com</a>. Correction: June 21, 2024 — An earlier version of this story incorrectly stated the incentives for Work Here, Live Here. The program provides funds for the purchase of a home, not home renovations.

An Arkansas county doesn't want families to move. It's offering them up to $50,000 to buy a new home.

<ul class="summary-list"><li>President-elect Donald Trump has pledged to end income tax on tips.</li><li>The proposal is part of Trump's broader tax cut plan, including for overtime and Social Security.</li></ul>US President-elect Donald Trump has pledged to end income tax on tips. Now, his administration will have to figure out how to make the numbers work."We're going to try to make that happen in the Congress," said House Speaker Mike Johnson on CNN's <a target="_blank" class="" href="https://edition.cnn.com/2024/11/17/politics/video/sotu-johnson-on-eliminating-tax-on-tips">"State of the Union" on Sunday.</a>"You have got to do the math. You have got to make sure that these new savings from American people can be paid for and make sure the economy is a pro-growth economy," Johnson said.During his presidential campaign, Trump pledged a range of tax cuts. They include an extension of <a target="_blank" class="" href="https://www.businessinsider.com/tax-cut-tariff-plan-outlook-presidential-election-scenarios-harris-trump-2024-10">tax cuts</a> from the Tax Cuts and Jobs Act of 2017 — also known as the "Trump tax cut" — as well as eliminating taxes on overtime pay, Social Security checks, and tips. During remarks in Arizona in September, Trump said that ditching taxes on overtime would give "people more of an incentive to work."The tax cuts are just some of Trump's economic policies that economists say could significantly ramp up the federal debt balance and widen the deficit, which stood at nearly $36 trillion on Thursday. Other than tax cuts, Trump has pledged to implement across-the-board 60% tariffs on all Chinese goods and other tariffs on overseas goods.If Trump makes good on all his economic policy pledges, they could add as much as <a target="_blank" rel="" class="" href="https://www.businessinsider.com/trump-policies-economy-recession-inflation-stock-market-outlook-nouriel-roubini-2024-11">$10 trillion to the US debt</a> over the next decade, according to an estimate from top economist <a target="_blank" class="" href="https://www.businessinsider.com/trump-policies-economy-recession-inflation-stock-market-outlook-nouriel-roubini-2024-11">Nouriel Roubini.</a>In Trump's 2016 campaign, he said he would eliminate the national debt. It rose about $7.8 trillion during his first term.

Mike Johnson says Congress needs to figure out the math behind Trump's tax cuts on tips

<ul class="summary-list"><li>Electric cars are expensive, but tax credits might be able to help.</li><li>Federal tax incentives are crucial for EV buyers. State rebates help, too.</li></ul>While electric-vehicle prices have come down in the past year, affordability is still an issue for US buyers.According to Cox Automotive, new EVs sold for an average of $56,328 in September, while the average price paid for any new car was $48,397.Such high pricing is making it harder for <a href="https://www.businessinsider.com/electric-vehicle-misconceptions-about-the-ev-transition-market-sales-2024-5">a new wave of shoppers</a> to commit to an electric car, but federal and state tax credits that give you money back for buying an EV could mean you're in luck if you're looking to plug in. You just need to know how to cash in.New requirements for a $7,500 federal tax credit under the <a href="https://www.businessinsider.com/how-to-get-electric-vehicle-tax-credit-ira-biden-2022-12">Inflation Reduction Act</a> went into effect at the start of this year. The revised rules <a href="https://www.businessinsider.com/list-evs-electric-cars-qualify-for-federal-tax-credit-2024-1">limited the number of EVs</a> on the market that qualify for the credit, but more vehicles are expected to qualify as automakers adjust. In the meantime, <a href="https://www.businessinsider.com/electric-vehicle-lease-payments-cheaper-affordability-hack-2024-9">a leasing loophole</a> is helping more buyers access the full $7,500 credit.Here's what to know about claiming tax credits and rebates on electric-car purchases.<div type="image" title="Tesla cars on the production line in a warehouse." height="3857" width="5142" msid="115030133" hostid="261" sizebytes="1143850"></div><h2>Federal EV tax credits</h2>The <a href="https://fueleconomy.gov/feg/tax2023.shtml">federal EV tax credit</a> is split: You can get $3,750 if the vehicle meets either the critical-minerals requirements or the battery-component requirements. If it meets both sets of requirements, it qualifies for the full $7,500 credit.Here's a closer look at those requirements:<ul><li>The vehicle must have a battery capacity of 7 kilowatt-hours or more.</li><li>The gross vehicle weight rating must be less than 14,000 pounds. (For context, the gargantuan Hummer EV weighs about 9,000 pounds.)</li><li>Final assembly of the vehicle must take place in North America.</li><li>At least 50% of minerals for the vehicle and battery components must be extracted, processed, or recycled in the US or countries with which the US has a free-trade agreement.</li><li>The manufacturer's suggested retail price can't top $80,000 for vans, SUVs, and pickup trucks, or $55,000 for all other vehicles.</li></ul><div type="image" title="A charger hanging out the side of a car." height="2673" width="3565" msid="115030135" hostid="261" sizebytes="227186"></div>The leasing loophole:<ul><li><a href="https://www.businessinsider.com/electric-vehicle-lease-payments-cheaper-affordability-hack-2024-9">Leased electric vehicles</a> are categorized under the "qualified commercial clean vehicles" tax credit, which has fewer restrictions than the "new clean vehicle" credit outlined above.</li><li>Under these rules, dealers are afforded $7,500 for all-electric vehicles and are not held to the individual buyer standards of income caps, MSRP limits, or mineral and component requirements. Dealers are taking advantage of this by passing along their $7,500 credit to lessees who may not otherwise qualify for the credit if they purchase the vehicle.</li></ul>If you're buying used:<ul><li>The used-EV credit took effect last year.</li><li>The vehicle must be at least two years old, under $25,000, and sold by a licensed dealership.</li><li>Your income can't exceed $150,000 if you're a joint filer or surviving spouse, $112,500 if you're a head of household, or $75,000 if you're a single filer.</li><li>Taxpayers are eligible for a credit of 30% of the vehicle price, up to $4,000.</li><li>The purchaser cannot be the same person who bought it new.</li><li>There can only be one credit taken per vehicle.</li><li>Taxpayers can use this credit once every three years.</li></ul><h2><div type="image" title="Three Ford Mustang Mach-E electric vehicles on a dealer lot." height="1665" width="2220" msid="115030136" hostid="261" sizebytes="198372"></div></h2><h2>State credits</h2>Some states have incentives for EVs in addition to the federal tax credits. Here are just a few examples.Colorado: <ul><li>Residents can get <a href="https://afdc.energy.gov/laws/11702">a tax credit</a> of up to $5,000 for buying or leasing a light-duty EV or truck or a plug-in hybrid EV.</li></ul>Illinois:<ul><li>The state offers <a href="https://www2.illinois.gov/epa/topics/ceja/Pages/default.aspx">rebates</a> of up to $4,000 for residents who buy or lease a new or used EV.</li></ul>New York: <ul><li>Residents can get a $2,000 rebate for EVs with an EPA-rated range greater than 200 miles, $1,000 for EVs rated 40 to 199 miles, and $500 for EVs with a range under 40 miles or with a sticker price under $42,000.</li></ul>Rhode Island:<ul><li>The state offers residents up to $1,500 for the purchase or lease of a new battery-electric vehicle or $1,000 for a used one. It also offers up to $1,000 for the purchase of a new plug-in hybrid vehicle or $750 for a used one.</li></ul>

Using tax credits and rebates to your advantage could save you thousands on a new electric vehicle

My grandparents' vacation cabin in Lake Tahoe is the stuff of legend.In the '90s, when my parents were just friends, my dad "accidentally" invited himself on a ski trip with my mom and her parents. It was an epic winter when the blizzards created berms as tall as the houses. By the time spring came, my parents were dating.My grandparents' little house in South Lake Tahoe, which they bought for $113,000 in 1984, quickly became a haven for my family.I dreamed of getting married there and taking my own kids to the cabin someday. But in May, my mom called to tell me this could be the last year we have the home.A tax on vacation home-owners might make our place in Tahoe too costly to keep.A measure on the ballot today proposes an annual tax on every property occupied less than 51% of the year. If it passes, second-home owners would owe $3,000 in 2026 and $6,000 every year after.In ski towns and cities across the US, home prices have skyrocketed, and young people struggle to pay rent or buy a house. Meanwhile, the wealthy have flocked to mountain retreats where they can vacation and work from home. One of the measure's architects told BI that it will combat this trend by incentivizing second-home owners to rent to local residents, bringing down the cost of housing by increasing the available supply.Supporters project city revenue gains of $4 million to $8 million in the first year and $10 to $20 million every year after that. The money would go toward rebuilding roads, creating more public transit, and paying the administrative costs of implementation.Framers of the Tahoe tax measure took inspiration from Berkeley, California, which adopted a vacancy tax this year. The Hawaiian island of Oahu and the Colorado ski towns of Aspen, Vail, and Breckenridge are also considering vacancy taxes.But some say it's unclear whether the tax will actually lower housing prices for locals.<div type="image" title="View of the mountains around South Lake Tahoe" height="3279" width="4896" msid="114990171" hostid="261" sizebytes="935262"></div>The opposition in South Lake Tahoe is made up of some of its institutionalized powers, including the local Chamber of Commerce, the South Tahoe Association of Realtors, and the restaurant and lodging associations. In interviews, they told BI that a tax would drive second-home owners away, depriving local businesses of their spending while having no impact on housing affordability for locals. The city's report on the economic outcomes of the tax said it may not actually incentivize homeowners to rent or sell to locals.Some long-timers feel squeezed: How do they afford to live in these places, and what measures would actually fix the problem? Is it a tax — or is it, say, zoning changes that allow more homes to be built?Similar battles over housing affordability are happening across the country. I just happen to have a front-row seat to this one.Since the city of South Lake Tahoe was incorporated in 1965, it's been populated by a healthy mix of year-round and seasonal residents.Middle- and upper-middle-class mountain enthusiasts from the Bay Area flocked to the city, which, with 21,000 residents per the most recent census data, is more densely populated than any other town around the lake.This part of Tahoe has long been a relatively more affordable alternative to the ski havens of Colorado and Utah. As of October 2024, the median sales price for homes in South Lake Tahoe was $750,000, according to Realtor.com. By comparison, it was $958,000 in Park City, Utah, $1.4 million in Aspen, and $1.6 million in Vail."It's one of these places where you have folks from really different socioeconomic backgrounds," said Amelia Richmond, who favors the tax and leads a group of other supporters called Locals For Affordable Housing. "It's one of the reasons I think mountain towns are so cool."But that environment doesn't exist without both year-round and seasonal residents in town. Fifty-six percent of Tahoe's 9,125 housing units are filled by renters, while 44% are owner-occupied, according to the US Census' American Community Survey.Because Measure N will appear on the local ballot, most second-home owners directly affected by the tax can't vote. Nearly half of the property-owning population — my family included — is left watching debates over the tax play out among local residents, who are split on where they stand.<h2 id="90a60f06-f278-4362-9ebf-345a4dac61c6">Locals are divided on the tax</h2>Steve Teshara, who has held several roles, including CEO, at the Tahoe Chamber of Commerce, said the tax would hurt the local economy by driving out second-home owners.He pointed to evidence from a previous measure, which banned Airbnbs and other short-term rentals in certain parts of town. That measure was also intended to stabilize area home prices and rents."It has an immediate effect when visitors are not able to spend as much money or when visitors just aren't here anymore," Teshara said.The previous measure effectively reduced the supply of Airbnbs from 3,350 units in January 2018 to 2,635 units in July 2024, according to the short-term rental data company AirDNA. However, it didn't make the expected dent in housing costs, data from the Realtors' Association shows. Median sale prices continued to increase overall, from $440,000 in 2018 to $750,000 in 2024.<div type="image" title="View of Highway 50 in South Lake Tahoe with a light dusting of snow" height="4153" width="5538" msid="114990167" hostid="261" sizebytes="1763634"></div>Teshara believes the housing crisis must be solved in the long term, pointing to the local government's <a target="_blank" class="" href="https://www.cityofslt.us/2332/Affordable-Housing-Properties-Other-Deve">affordable housing construction projects</a>. He is a fan of indirect measures currently in place, like vanpooling, which shuttles people who live further away — where prices are lower — through the mountains to work.Richmond, the pro-tax organizer, said that business from year-round residents is more important to many shops and restaurants than purchases from occasional visitors."How many beers do you have to buy to make up that difference when you're up just once a quarter?" she said. "Local economies are actually robust when you have a healthy middle class that can spend small amounts of money on a regular basis."<h2 id="139d1f43-575b-4368-9419-52d99a68446e">Taxing second home-owners may not make them rent to locals</h2>The city of South Lake Tahoe conducted an independent study on the tax's economic outcomes if it were to go into effect.The findings supported Richmond's assertion that the measure could modestly boost sales tax revenue if second homes vacated by owners were converted into permanent residences or long-term leases.But the report also cautioned that the measure's impact on housing availability will depend largely on how second-home owners react if the tax is adopted — behavior that's nearly impossible to predict.Second-home owners could sell their properties, like my family is considering. But because of current home prices, buyers would likely be people who don't see an additional $6,000-a-year expense as a deterrent. While the city could collect additional tax revenue from a wealthier population of second-home owners, that wouldn't make it any easier for locals to buy.Homeowners could also decide to rent and become landlords instead of selling, as Richmond hopes. But that may be a longer shot, the city report found.Based on the previous leasing programs in the area, "it appears that financial incentives are not particularly effective to motivate owners of vacant property in South Lake Tahoe to rent out their homes for longer terms," the report said.<div type="image" title="A view of South Lake Tahoe in 1974" height="3458" width="5142" msid="114990163" hostid="261" sizebytes="1062714"></div>Some second-home owners told Business Insider they would refuse to rent to tenants.Sherri Maslyar, who has owned a home in South Lake Tahoe with her husband since 2013 and visits monthly, said she heard a horror story about a neighbor's long-term tenant who defied the landlord's no-pets rule and ruined parts of the house. She said she would rather pay the tax than risk renting her home to someone untrustworthy."That's not what we bought the house for," she said.<h2 id="534b0195-f639-4a7b-8fb1-9c677eca426d">Tahoe's character — and prices — have changed over the years</h2>The median income in South Lake Tahoe grew 65% from $40,972 to $67,686 between 2000 and 2022, according to census data. In the same period, median home prices in the area ballooned by 288%, from $189,000 to $732,500.Zillow's rent data, which only goes back to 2020, shows that typical rents in South Lake Tahoe grew from $2,101.52 in October 2020 to $2,653.05 in October 2023. The typical rent as of September 30 was $2,682.50.The neighborhood where our family's cabin sits was once populated by eclectic A-frames and modest one-story structures, whose kitschy exteriors tended to match the eccentricities of their owners. Now, vaguely chic rustic McMansions with smooth angles and wood finishing are common.<div type="image" title="Line of wooden bears carrying &quot;howdy&quot; and &quot;welcome&quot; signs" height="3435" width="5617" msid="114990174" hostid="261" sizebytes="1760630"></div>Part of why building more houses or apartments — which might stabilize prices — has been so difficult is due to strict development laws. In Lake Tahoe, all development projects must be approved by the Tahoe Regional Planning Association (TRPA), whose primary objective is conservation, not housing construction.Jeff Cowen, TRPA's public information officer, told BI the agency's main goals were environmental, adding that "we have to consider community impacts of our regulations." It doesn't have a stance on the tax.One thing opponents and proponents of Measure N agree on: TRPA's mandate has made it difficult to build new housing in Tahoe to address the housing shortage. But they disagree on whether radical and rapid changes should be made to make Tahoe affordable right now.<h2 id="7b8ad7f8-c9b9-4a00-b5a4-14745b01c7cc">It might be the end of Tahoe as we know it</h2>A place that was once accessible as a seasonal destination for a middle-class family risks becoming a playground for the very rich if changes in the Tahoe market continue to make buying a home there relatively unaffordable.I am benefiting from generational wealth stemming from my grandparents' choices, and I will always be grateful for the investment they made.My family isn't sure what we'd do if the tax passes. One option is to rent to a long-term tenant, but we'd likely lose the freedom to come and go seasonally. Another is to sell the house.<div type="image" title="A middle-aged Asian American couple and their 10-year-old daughter standing in front of an old car in a ski resort parking lot." height="537" width="800" msid="114990172" hostid="261" sizebytes="23164"></div>Either way, we'd be saying goodbye to the home as we've known it for the past four decades.It's hard to imagine giving up my ties to a place that has such emotional value — that is very much the second home my grandparents intended it to be. And if the tax doesn't do what proponents hope it will, I'd be losing Lake Tahoe for nothing.All I can do now is wait and see.

My family bought a vacation home in Lake Tahoe for $113,000. A new tax could push us out. 

<ul class="summary-list"><li>Presidential hopeful Donald Trump has proposed getting rid of taxes on tips and overtime.</li><li>Trump said he intends for those proposals to help low earners and incentivize work.</li></ul>If former President Donald Trump gets his way, workers who collect <a target="_blank" class="" href="https://www.businessinsider.com/you-might-be-eligible-for-overtime-pay-2023-8">overtime pay</a> or <a target="_blank" class="" href="https://www.businessinsider.com/drivers-and-servers-share-how-they-earn-extra-money">tips</a> could stop paying taxes on them.During remarks in Arizona earlier in September, he <a target="_blank" class="" href="https://www.cbsnews.com/news/trump-unveils-new-no-tax-on-overtime-pay-policy-in-arizona-remarks/">said</a> that ditching taxes on overtime would give "people more of an incentive to work."The current system treats overtime and tips just like any other income; they're taxed as part of a worker's normal wages. But if Trump's proposal goes into place, it could save hospitality workers a significant amount each year.There were around 4 million workers in tipped occupations in 2023, according to an analysis from <a target="_blank" class="" href="https://budgetlab.yale.edu/news/240624/no-tax-tips-act-background-tipped-workers">The Budget Lab at Yale</a>. And while part of the group had incomes low enough that they paid no income tax, there's a pool of more than 2 million workers that stand to benefit.It's a policy that has broad appeal: an Ipsos <a target="_blank" class="" href="https://www.ipsos.com/en-us/proposed-policy-end-federal-income-tax-tips-has-bipartisan-support">poll</a> from August found that the majority of Americans support ending federal taxes on tips. It's also a rare topic Trump and Kamala Harris can agree on. In mid-August, the vice president and Oval Office hopeful <a target="_blank" class="" href="https://www.businessinsider.com/harris-agrees-trump-tips-service-workers-not-taxed-2024-8">jumped on board</a> with her own proposal for making some tips tax-exempt.Millions more workers — specifically those paid hourly, as well as salaried workers who make under about $44,000 a year — are eligible for overtime, typically receiving 150% of their usual pay for going over 40 hours a week.These measures, if enacted, could fundamentally alter the structure of income across America, especially since both employees and companies are expected to quickly optimize their tax strategies.<h2 id="925f2f99-c64e-4f6e-aec9-6923725b85e3">Tax-strategy adjustments</h2>The first question is when exactly the new changes would go into place. For starters, Trump has to win the election, something that's currently a coin flip, according to <a target="_blank" class="" href="https://projects.fivethirtyeight.com/polls/president-general/2024/national/">polling averages</a> that have Trump and Harris roughly tied in battleground states.If Trump does emerge victorious, implementing these changes would require congressional approval. Given that the former president's 2017 tax laws are set to expire in 2025, lawmakers may seize the opportunity to include these proposals in a new set of laws.As soon as that law is signed, it's likely that employees would quickly look for ways to navigate and optimize the new system in an attempt to lower their tax burdens.Employers would be no different, and shifts to current pay structures should be expected. Heidi Shierholz, senior economist at EPI Action — a left-leaning nonpartisan organization advocating for economic justice — told Business Insider that businesses could pay their workers slightly less to allow employees to have the financial benefit of not having their overtime pay or tips taxed."Their employer can pay less to keep them but the worker is not worse off because now they don't have to pay taxes on that," Shierholz said.It could also result in service-industry businesses further shifting the burden of paying workers a living wage onto customers, and reducing the amount of tax paid into <a target="_blank" class="" href="https://www.businessinsider.com/when-will-social-security-benefits-run-out-retirement-crisis-boomers-2024-5">Social Security</a>.Multiple other experts told BI that such tax-optimization tactics would also be used by both workers and employers outside the service industry.It could mean, for example, that some businesses claim that the fees they charge are actually tips. Or it could mean some salaried workers switch to hourly wages in order to qualify for a higher rate of untaxed overtime pay.Joe Hughes, a senior analyst on federal tax policy at the Institute on Taxation and Economic Policy, told BI that "you would need a lot of safeguards in place to keep this from being just another avenue for tax avoidance."He continued: "It's at least applaudable that Trump says that he wants to help low-income workers. But I think that there are much better avenues to do that than exempting very specific types of income."Alex Muresianu, a senior policy analyst at the Tax Foundation, told BI that a tip has a specific definition: it has to be a voluntary payment given to a worker by a customer that has not been negotiated beforehand. In an extreme case, Muresianu said, some workers could stretch that."Introducing that as the norm in response to the policy would effectively shift some compensation that is normally small business income or something into tax-exempt tips," he said.Hughes said that workers could take a similar approach with the overtime proposal — they might choose to reclassify themselves as wage earners instead of salaried earners so they could earn tax-exempt overtime pay."A lot of lawyers are working 60, 70 hours a week, right? So why not reclassify yourself as a wage employee, then you get to take advantage of overtime rules and not pay taxes on it," he said.Shierholz said that the US already has a complicated tax code, and there are more efficient ways to better help low-income workers, like increasing overtime pay and raising the minimum wage so workers do not have to rely on tips from customers to stay afloat."A problem through this absolutely Rube Goldberg approach is that it has all of these unintended distortionary consequences that you could just address directly," she said.The Trump campaign did not respond to a request for comment on the potential for the tax proposals to lead to avoidance. But Karoline Leavitt, the Trump campaign's national press secretary, told BI that "Trump proudly passed the largest tax cuts for hardworking Americans in history.""When President Trump is back in the White House, he will make the Trump tax cuts permanent and end taxes on tips for service workers, end taxes on overtime pay, and end tax on Social Security," she added.Do you collect tips or overtime pay? What are your thoughts on eliminating taxes on tips and overtime? Share your story with this reporter at <a target="_blank" href="mailto:asheffey@businessinsider.com">asheffey@businessinsider.com</a>.

Trump's plan to scrap taxes on tips and overtime could reshape how millions of Americans get paid

Finance Minister <keyword id="19916618" type="General" weightage="20" keywordseo="Nirmala-Sitharaman" source="keywords">Nirmala Sitharaman</keyword> on Tuesday announced <keyword id="20404375" type="General" weightage="20" keywordseo="income-tax-relief" source="keywords">income tax relief</keyword> for the <keyword id="20071167" type="General" weightage="100" keywordseo="middle-class" source="keywords">middle class</keyword>, a Rs 2 lakh crore outlay for <keyword id="22517841" type="General" weightage="20" keywordseo="job-creation-schemes" source="keywords">job creation schemes</keyword> over the next five years and a spending splurge for states run by her party's new coalition partners as she unveiled <keyword id="20509939" type="General" weightage="20" keywordseo="Modi-3-0" source="keywords">Modi 3.0</keyword> government's first budget after the general elections. With rural distress and unemployment being blamed for BJP losing its majority, Sitharaman in her seventh straight budget provided Rs 2.66 lakh crore for <keyword id="20027688" type="General" weightage="20" keywordseo="rural-development" source="keywords">rural development</keyword> and maintained spending on long-term infrastructure projects at Rs 11.11 lakh crore to boost <keyword id="19900794" type="General" weightage="20" keywordseo="economic-growth" source="keywords">economic growth</keyword>. She abolished 'angel tax' for all classes of investors in startups, cut customs duty on mobile phones and gold and simplified capital gains tax. She, however, raised the securities transaction tax (STT) on futures and options of securities, which led to tanking of stock markets. "India's economic growth continues to be the shining exception (in a world that is gripped by policy uncertainties) and will remain so in the years ahead," she said. "In this budget, we particularly focus on <keyword id="19898684" type="General" weightage="20" keywordseo="employment" source="keywords">employment</keyword>, <keyword id="20374219" type="General" weightage="20" keywordseo="skilling" source="keywords">skilling</keyword>, MSMEs, and the middle class." Besides Rs 2 lakh crore provided over a five year period for schemes and initiatives to facilitate employment, skilling and other opportunities for 4.1 crore youth, "I have made a provision of Rs 1.48 lakh crore for education, employment and skilling," she said. For Bihar, where assembly elections are due next year, the finance minister announced spending of Rs 60,000 crore on infrastructure projects like expressways, power plant, heritage corridors and new airports. The support to Bihar, whose ruling party and BJP's partner JD-U has been demanding an economic package and special category status for the state, is in the form of capital projects but not subsidy or cash dole. Similarly, for Andhra Pradesh, whose ruling TDP recently joined BJP-led NDA, she allocated Rs 15,000 crore in financial aid through multilateral agencies. A similar request for support to Bihar will be expedited, she said. For the middle class, she raised standard deduction -- a flat deduction from total salary earned by an employee in a year before calculating applicable income tax rate -- by 50 per cent to Rs 75,000 and tweaked tax slabs for taxpayers opting for the new income tax regime. This will lead to taxpayers under the new tax regime -- which offers lower rates of taxes but permits limited deductions and exemptions -- saving up to Rs 17,500 in tax annually, she said. To spur employment, the Budget provided for incentives for companies, including paying for one-month salary for first-time employees, incentive at specified sale to both employee and empower with respect to their retirement fund contribution in the first four years of employment and reimbursing employers up to Rs 3,000 per month for 2 years towards EPFO contribution of each additional employee. Also, a programme to improve skills as well internship for students and subsidised loans for higher education will be provided, she said. India's official unemployment rate in urban areas is pegged at 6.7 per cent but private agencies put it at much higher levels. Buoyed by robust tax collections and a higher-than-expected dividend receipt from the Reserve Bank, Sitharaman said the government's fiscal deficit -- the difference between the total revenue earned and total expenditure -- will be trimmed to 4.9 per cent of the GDP in 2024-25, below the 5.1 per cent figure estimated in the interim budget she presented in February. She reduced gross market borrowing marginally to Rs 14.01 lakh crore. The Budget for 2024-25 fiscal (April 2024 to March 2025) allocated Rs 1.52 lakh crore for agriculture and allied sectors, aid for building 3 crore affordable housing units in urban and rural areas, provided credit support to small and medium businesses, raised small loans to Rs 20 lakh for small business, proposed setting up 12 industrial parks, and provided for setting up a Rs 1,000 crore venture capital fund for space sector.

Modi 3.0 1st Budget: Tax relief for middle class, Rs 2 lakh cr job scheme

<keyword id="20190045" type="General" weightage="20" keywordseo="Industry-body" source="keywords">Industry body</keyword> <keyword id="21568150" type="General" weightage="20" keywordseo="SME-Chamber-of-India" source="keywords" meta.keywordsubtype="org" meta.entityname="SME Chamber of India" meta.hostid="261" meta.entityid="SME Chamber of India">SME Chamber of India</keyword> has urged <keyword id="19956758" type="General" weightage="20" keywordseo="Finance-Minister" source="keywords">Finance Minister</keyword> <keyword id="19916618" type="General" weightage="20" keywordseo="Nirmala-Sitharaman" source="keywords">Nirmala Sitharaman</keyword> to continue the 45-day <keyword id="21233021" type="General" weightage="100" keywordseo="MSME-payment-rule" source="keywords">MSME payment rule</keyword> for <keyword id="20008810" type="General" weightage="20" keywordseo="corporates" source="keywords">corporates</keyword> and other buyers. According to Section 43B(h) of the <keyword id="19936187" type="General" weightage="20" keywordseo="Income-Tax-Act" source="keywords">Income Tax Act</keyword>, introduced through the <keyword id="19955404" type="General" weightage="20" keywordseo="finance" source="keywords">Finance</keyword> Act 2023, if a larger company does not pay an MSME on time -- within 45 days in case of written agreements -- it cannot deduct that expense from its taxable income, leading to potentially higher taxes. The government in last year's Budget added a new clause under Section 43B of the Income Tax Act to address the challenge of delayed payments faced by MSMEs in the country. "We are pursuing not to change the 45-day MSME payment rules imposed by the Department under the pressure of corporates or multinational companies to save the life span of the MSME sector. Section 43B(h) of the Income Tax Act reinforces the importance of timely payments by mandating that companies settle payments to MSME vendors within 45 days to qualify for deductions," SME Chamber said in a statement addressed to Sitharaman. The industry body argued that this provision serves as a powerful incentive for companies to adhere to payment timelines, thereby supporting the financial health of MSMEs. "Many MSMEs are NPA victims of corporates, who are buying from them and not dealing through the TReDs platform. Most of the corporates and multinational companies are forcefully insisting to deregister from the Udyam Portal and insisting not to deal through the TReDs platform," SME Chamber stated. The industry body also urged the finance minister to consider providing Rs 5 crore loans under the "Differential Rate of Interest" scheme for micro and <keyword id="20569966" type="General" weightage="20" keywordseo="small-enterprises" source="keywords">small enterprises</keyword>. It suggested changing the NPA definition from 90 days to 180 days for the MSME sector. The chamber also sought the setting up of a task force to review various issues, hurdles, grievances and difficulties faced by MSMEs for availing credit facilities and the lack of approach by the financial institutions towards enhancement of credit flow to the MSME sector.

Continue 45-day MSME payment rule: Industry body to Finance Minister Nirmala Sitharaman

<ul class="summary-list"><li>Kamala Harris is aiming for 25 million new business applications in her first term.</li><li>To get there, she's proposing an increased tax deduction and reduced red tape.</li></ul>Vice President Kamala Harris wants you to start a small business.Harris is set to roll out another economic policy, focused on a new goal: boosting small business creation. Harris's goal — which she'll announce on Wednesday — is 25 million new business applications in her first term if elected.That would outpace the <a target="_blank" href="https://www.sba.gov/article/2024/04/11/new-small-business-applications-soar-over-17-million-under-biden-harris-administration">over 18 million new business applications</a> filed so far during the Biden-Harris administration, which comes amid a post-2020 <a target="_blank" href="https://www.uschamber.com/small-business/new-business-applications-a-state-by-state-view">business application boom</a>. Harris aims to hack away at some of the red tape and startup costs new businesses face when they're setting up shop.According to a Harris campaign official, Harris wants to bolster the tax deduction that small businesses can claim for initial startup costs. Some small business owners have to turn to <a target="_blank" href="https://www.businessinsider.com/alternative-business-funding-options-small-companies-2023-9">creative funding measures</a> to get their businesses off the ground, which can come with their own risks.Harris's proposal would increase that startup deduction tenfold, upping it from $5,000 to $50,000; businesses would also be able to defer claiming it until they turn a profit — which is when they'd also likely encounter a larger tax burden.The other aspect of Harris's plan hinges on easing the logistical burden on new entrepreneurs. It's no secret that many small businesses must wade through <a target="_blank" href="https://www.businessinsider.com/jpmorgan-jamie-dimon-says-bureaucracy-is-crippling-us-hindering-progress-2021-4">administrative red tape</a> to finally <a target="_blank" href="https://www.businessinsider.com/something-about-her-sandwich-shop-opening-day-vanderpump-rules-2024-5">get to their opening days</a>.Harris's proposals include incentives for local governments to reduce their own red tape, creating a standard deduction for small businesses to ease the time spent on taxes, and chipping away at barriers in obtaining occupational licenses that can inhibit businesses or workers from crossing state lines.Harris also wants to pour cash into small businesses: She wants to guarantee that a third of federal contract dollars will go to smaller businesses and set up a fund to help community banks cover the cost of interest for small businesses.Harris previously called for a <a target="_blank" href="https://www.businessinsider.com/child-tax-credit-new-parents-cut-taxes-harris-economic-policy-2024-8">restoration of the expanded child tax credit</a> — bringing it back up to $3,600 — and giving middle and lower-income parents a $6,000 credit in their child's first year of life.How far a hypothetical future President Harris could get with major economic proposals will depend on the makeup of Congress. Attempts by President Biden to restore the child tax credit were stymied in the Senate; a gridlocked legislature might mean even more roadblocks for potential President Harris.

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