The Trump administration’s tax and trade policies remain front and center this week, as new battles over digital regulations escalate and economic inequities sharpen. Trump is threatening tariffs against countries targeting U.S. tech companies, while a new study shows billionaires pay significantly lower effective tax rates than most Americans. Meanwhile, Social Security’s COLA bump for 2026 may not be enough to keep pace with inflation, and Republicans are scrambling to rebrand Trump’s unpopular “One Big Beautiful Bill.”
This week’s top stories:
- Trump threatens new tariffs over global digital taxes
- Trump seeks to rebrand “Big Beautiful Bill” amid poor polling
- Billionaires pay lower tax rates than most Americans, study finds
- Social Security COLA set to rise, but retirees still squeezed
- Tech trade tensions flare as EU and U.S. face off
Let’s read more.
1. Trump Threatens Tariffs Over Global Digital Taxes
Trump vows retaliation against countries targeting U.S. tech companies
President Trump announced plans to impose new tariffs and export restrictions on countries with digital taxes or regulations he claims “discriminate against American technology.” The move directly challenges European Union rules targeting Big Tech platforms.
Key takeaways:
- Targets include the EU’s Digital Services Act and Digital Markets Act
- Trump promises “substantial tariffs” and chip export controls
- Tensions escalate despite recent U.S.–EU commitments to cooperate on trade
Advisors working with tech clients or import-export businesses should monitor how these policy shifts may impact cross-border tax planning and compliance costs.
2. Trump Looks to Rebrand “Big Beautiful Bill”
Trump’s signature tax law gets a new name
Amid ongoing criticism and weak polling, President Trump signaled plans to rebrand his “One Big Beautiful Bill.” Some GOP strategists are pushing to rename it the “Working Family Tax Cuts” law to highlight middle-class benefits.
What’s driving the shift:
- Polls show bipartisan skepticism of the bill ahead of 2026 midterms
- GOP touts new deductions on tips, overtime, and senior benefits
- Critics highlight steep Medicaid and clean energy funding cuts
- The CBO estimates the bill will add $3.4 trillion to the deficit
Advisors should expect renewed client confusion as rebranding campaigns create messaging gaps about the law’s impacts.
3. Study Finds Billionaires Pay Lower Tax Rates Than Most Americans
Billionaires’ effective tax rate averages 24% vs. 30% for other taxpayers
New research from UC Berkeley economists Emmanuel Saez and Gabriel Zucman reveals billionaires pay significantly lower effective tax rates than the average U.S. taxpayer, thanks largely to preferential treatment of capital gains and corporate profits.
Highlights:
- Top 400 billionaires: 24% effective tax rate
- Average U.S. taxpayers: 30% effective tax rate
- Trump’s 2025 tax law raises the estate-tax exemption to $15M per person
- Saez and Zucman renew calls for a U.S. wealth tax
For high-net-worth advisors, expect heightened scrutiny around estate planning, equity compensation strategies, and potential future policy shifts.
4. Social Security COLA Rising in 2026, But Retirees Still Squeezed
Projected COLA: +2.7%, but inflation and Medicare costs offset gains
The Senior Citizens League projects a 2.7% Social Security cost-of-living adjustment (COLA) for 2026, but rising Medicare premiums and persistent inflation are eroding purchasing power for retirees.
Key points:
- Average benefit increase: +~$54/month
- 63% of retirees fear rising tariffs will drive higher inflation
- Medicare Part B premiums may offset much of the COLA increase
Advisors supporting retirees should prepare proactive cash-flow scenarios factoring in rising healthcare costs and possible benefit compression from future Social Security reforms.
Your Takeaway This Week
Trump’s digital tax fight, ongoing rebranding of his flagship tax bill, billionaire tax inequities, and Social Security pressures all point to one theme: client planning is becoming more complex and more global.
From advising tech founders on cross-border compliance to helping retirees facing real-dollar inflation risk, today’s tax strategies need to integrate trade policy, fiscal law, and wealth planning in ways that weren’t necessary just a few years ago.
Want to help your firm deliver more proactive, integrated tax planning?
Talk to Harness today to see how our platform supports modern advisors and their clients.
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