White House retracts Trump’s claim of layoffs amid ongoing government shutdown
Washington: The White House clarified on Monday that no US government employees have been laid off “right now.” Stepping back from President Donald Trump’s earlier remarks suggesting that job losses were already underway due to the ongoing federal shutdown, officials, however, cautioned that layoffs could occur if Congress fails to restore government funding soon.
In its sixth day, the partial shutdown has halted operations across multiple agencies, while no permanent dismissals have been reported.
President Trump had stated on Sunday night that workers were being laid off “right now.” White House Press Secretary Karoline Leavitt clarified on Monday that the president was referring to federal employees who have been furloughed since funding expired on October 1, and claimed that the Office of Management and Budget was working with agencies to determine which employees would risk layoffs if the shutdown continued.
Labor unions representing federal workers have filed lawsuits to block any such dismissals. They argued that such actions would violate existing labor laws, which carry criminal penalties.
The Republican proposal seeks to extend funding through November 21, while the Democratic proposal includes an extension of healthcare subsidies set to expire at the end of the year. Trump has indicated openness to a deal on healthcare subsidies, which would assist about 24 million Americans in purchasing insurance under the Affordable Care Act.
Democratic Senator Patty Murray, on the Senate Appropriations Committee, said on social media, “We need a deal that reopens the government and stops premiums from doubling.” Speaker Mike Johnson said he had no plans to reconvene the chamber until a funding agreement was reached, while the House of Representatives was not in session.
The impasse has frozen an estimated $1.7 trillion in discretionary spending, which is one-quarter of the federal budget. The remainder of U.S. government expenditure goes toward entitlement programs and interest on the national debt, which currently stands at $37.88 trillion.
The administration has also placed a hold on at least $28 billion in infrastructure funding earmarked for New York, California, and Illinois, all states led by Democrats. Democratic leaders have refused to yield to the White House’s stance.
Essential personnel, including border security and airport staff, have continued working without pay, while non-critical government functions have largely come to a halt. The Federal Register, which typically publishes over 100 notices and proposed regulations daily, listed only four entries on Monday.
The impact may deepen next week when 1.3 million military personnel and associated workers are expected to miss their first paychecks. Transportation Secretary Sean Duffy also warned that rising sick calls among air traffic controllers could result in flight delays.
Senate Democrats have voted down the Republican funding bill four times, and GOP leaders need at least eight Democratic votes to advance their measure, while only two Democrats and one independent have crossed party lines so far.
Several Democrats are pressing for a healthcare subsidy deal before open enrollment begins on November 1, while Speaker Johnson suggested that negotiations could take time.
“We’ve got probably 100 ideas for reforms on the table, but I can’t snap my fingers this afternoon and make that happen,” Johnson said in an interview with the Hugh Hewitt Show.
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What is Tax Holiday announced for foreign cloud firms till 2047 in Union Budget
New Delhi: Finance Minister Nirmala Sitharaman on Sunday announced a major tax incentive aimed at attracting global cloud service providers to set up and expand their operations in India. Under the Union Budget proposals, foreign companies that offer cloud services worldwide by using data centres located in India will be granted a tax holiday until 2047.
Announcing the measure, Sitharaman said the move is intended to draw global investment into India’s digital infrastructure, generate employment and strengthen the country’s role in the global digital economy.
A tax holiday is a policy tool used by governments to encourage investment. It involves a temporary reduction or complete exemption from certain taxes, usually corporate or income tax, for a defined period. Such incentives are often offered to promote specific sectors, boost economic activity and create jobs.
Under the new proposal, foreign cloud service providers will be allowed to operate globally using data centres based in India, but services to Indian customers must be routed through an Indian reseller entity. This structure is meant to ensure local participation and regulatory oversight while still allowing global companies to base their infrastructure in India.
Indian companies that provide data centre services to these foreign firms will receive a safe harbour tax rate of 15 per cent. Safe harbour provisions offer certainty on tax liability by fixing profit margins in advance, reducing disputes and making it easier for businesses to plan their operations.
The Budget also includes measures linked to electronic manufacturing. Non-resident companies will be allowed to use bonded warehouses in India to store components. These entities will be taxed on a profit margin of just 2 per cent of the invoice value, translating to an effective tax rate of around 0.7 per cent. The government says this rate is significantly lower than what is offered by many competing countries.
Explaining the rationale behind the move, Sitharaman said the policy would encourage large-scale investment in data centres and related infrastructure, create local jobs and help India emerge as a global hub for digital and cloud services.
