Aurelia Butler

MEXICO CITY (Reuters) – Claudia Sheinbaum will make history on Tuesday when she is sworn in as Mexico’s first woman president, while inheriting challenges to quell violence from organized crime and reduce a hefty deficit in Latin America’s No. 2 economy. Sheinbaum, the 62-year-old scientist and former mayor of Mexico City, will be inaugurated at a ceremony in Mexico’s Congress for a six-year term lasting until 2030. Political watchers and analysts predict she will urgently look to calm investors since the passing of a controversial judicial reform pushed by outgoing President Andres Manuel Lopez Obrador. Markets will be looking to Sheinbaum for “a predictable and investment-friendly policy and regulatory framework,” said Alberto Ramos, head of Goldman Sachs Latin American economic research.”Disciplined management of the budget and of state-owned enterprises, progress on public security, and safe-guarding the integrity of key institutions will be key to preserving market sentiment and sovereign debt ratings,” Ramos said, emphasizing the importance of state energy firm Petroleos Mexicanos (Pemex).The November presidential elections in the United States, Mexico’s largest trading partner, could add to market volatility, especially if former President Donald Trump, who has vowed to increase tariffs on Mexican goods, wins. Sheinbaum’s government will also present its first budget before Nov. 15, which is expected to be highly scrutinized for clues on whether Sheinbaum will make good on commitments to reduce the fiscal deficit to 3.5% of gross domestic product from 5.9%, where it is predicted to close the year. CONTINUITY WITH CHANGE?Lopez Obrador, whose six-year term began in 2018, managed to double Mexico’s minimum wage, reduce poverty and unemployment, broaden the base of social programs and oversee a previous strengthening of the peso. Touting these successes boosted his popularity and helped usher Sheinbaum, his protégé, to a landslide victory in the June elections.Sheinbaum, however, who has promised “continuity with change,” will inherit the largest budget deficit since the 1980s and lagging economic growth. Experts have said Mexico’s economy will require a tax reform to increase revenues, though Sheinbaum has said publicly she does not plan a sweeping tax overhaul. Instead, she has said she will pursue other options, including improving the efficiency of tax collection at customs.Sheinbaum “will have to deliver an important fiscal consolidation if she wants to keep the positive view that markets have today towards her,” said Bernardo Keiserman, an economist at investment bank Bradesco BBI.”We believe the government is committed to an adjustment, but delivering one sizable enough is not going to be an easy feat. The economy is weaker and likely weakening further,” Keiserman said. Recently, the central bank cut its GDP growth forecast for this year to 1.5% from the previous 2.4% and lowered its estimate for 2025 to 1.2%. The incoming administration will also inherit a heavy financial burden from state-owned Pemex, one of the most indebted oil companies in the world.Nearshoring, the trend of companies moving production closer to their main market, has helped Mexico attract investment, but Sheinbaum will face a challenge to increase foreign direct investment while implementing the controversial judicial reform passed in the dying days of Lopez Obrador’s presidency. The judicial reform, under which judges will be elected by popular vote, has scared investors and drawn criticism from the U.S. ambassador to Mexico who said it threatened the rule of law. More

Those outages were down from around 2.0 million on Monday afternoon as utilities continued to restore power. In total, the storm knocked out service to around 5.5 million customers.Helene’s winds, rain and storm surge killed over 100 people, according to a Reuters tally of state and local officials.The utility with the most outages was U.S. energy company Duke Energy (NYSE:DUK) in the Carolinas with about 395,000 customers still out in South Carolina and 266,000 out in North Carolina, according to PowerOutage.us.Duke said on Monday it had restored power to around 1.35 million customers in the Carolinas and expected to restore the majority of remaining outages by Friday night.Here are the major outages by state:State Outages South Carolina 624,000 Georgia 467,000 North Carolina 455,000 Florida 74,000 Virginia 67,000 West Virginia 18,000 Total Out 1,705,000 More

LAS VEGAS/RENO, Nevada (Reuters) – Two decades into her work as a unionized bartender in Reno, Nevada, Kristie Strejc has the comfort of job stability, her pick of the best shifts, and, unlike many in the hospitality industry, enough income that she’d actually benefit from plans floated by both U.S. presidential candidates to exempt tips from federal income tax.But that isn’t influencing a vote she said is solidly for Vice President Kamala Harris, the Democratic candidate who has the endorsement of Nevada’s powerful Culinary Workers Union Local 226 and in recent polls is leading former President Donald Trump, the Republican challenger, in this battleground state.”I’m kind of at a point where I could either go on ‘this’ vacation or buy ‘this’ for the house … I could probably do a little more of both if I had that money in my pocket,” she said when asked in an interview last month about the prospect of a tipped-income exemption. “That’d be a bonus, but I’m not going to vote because of one thing.”Proposals to exempt tipped income from federal taxes have emerged as Harris and Trump use competing economic proposals in areas like tariffs and taxes to vie for the votes of different constituencies, a strategy Trump has since extended to include a tax exemption for overtime pay. Some of the ideas are expensive. The Committee for a Responsible Federal Budget, a non-partisan public policy organization, recently estimated that eliminating taxes on overtime would cut government revenue by $1.7 trillion from 2026 to 2035.At least in Nevada, however, where the tip-heavy hospitality industry still comprises more than a fifth of jobs, the proposal to exempt tips from taxes has landed with a bit of a shrug.David Schmidt, chief economist for the Nevada Department of Employment, Training, and Rehabilitation, said the state had about $95 billion in annual wages reported to a Bureau of Labor Statistics quarterly census of wages in 2023. He estimates no more than about 1.5% was from tips.”It is not nothing, but it is not close to the lion’s share,” he said. “I don’t think you’d see really huge impacts … It is a pretty person-to-person kind of thing.”WORKING-CLASS ISSUEJeremy Gelman, an associate professor of political science at the University of Nevada, Reno, said he construed Trump’s proposal as an attempt to “sow doubt” among the roughly 60,000 members of the Culinary Workers Union Local 226 and Bartenders Union Local 165, whose well-organized voter mobilization program is “really effective when it’s turned on,” as it has been for Harris.The fact that both candidates have made the offer blunts the advantage for either of them, particularly when “the economy is going okay … It is not the best, but is not in a recession,” he said.Ted Pappageorge, the secretary-treasurer of the Culinary Workers Union, said there was little credence given to Trump’s proposal on an issue the union official regards as more complicated than a no-tax-on-tips approach alone can reflect. He sees it tied into broader national issues like the below-minimum wages tipped workers are paid in many states, and how best to help lower-income families that may pay no taxes but need help meeting basic expenses.”We’ve been fighting about fair taxation on tips for 30 years,” Pappageorge said in an interview last month, noting tips are not the same as a promised wage for an hour of work, but a gift at a customer’s discretion that can cause hourly earnings to vary widely.While Nevada is one of seven states that don’t allow employers to pay less than the minimum wage to tipped workers, he said the union still regards the issue as part of a larger set of questions that figured into its endorsement of Harris.”It’s a working-class voter issue,” Pappageorge said. “You could see a package that raised the minimum wage and perhaps didn’t eliminate tax on tips but reduced it or something.”LIMITED IMPACTThe Internal Revenue Service has not published detailed estimates of tipped income since 2018, when 6.1 million workers reported $38.3 billion of tipped income for purposes of Social Security payroll taxes.Recent research from the Budget Lab at Yale, a non-partisan policy research center, estimated as few as 3% of taxpayers nationally would benefit from a tipped-earnings exemption, with many others who collect tips making too little to owe any federal taxes.The exact impact, however, would depend on the details of the changes to the tax code and on how workers and employers respond.Harris has suggested the exemption should have an income limit, a detail that would lessen the effect on the federal deficit but further curb the number of workers who benefit. For whatever tax change was approved, economists would look for evidence of how behavior changed, and whether, for example, guaranteed pay gets reduced by employers if their workers got a “raise” through the tax exemption.”Both camps see their proposals as a way to improve the economic standing of low-wage workers,” Brookings Institution researchers Ian Berlin and William Gale said in a recent analysis. “We agree that this is an important goal, but there are much better ways to achieve it,” including minimum wage changes or expanded child care or earned income tax credits.”Exempting tips from taxation does nothing to help most low-income workers, and it may do little for many tipped workers,” they wrote.’A LITTLE BIT MORE’Mike Bosma, a Reno-based certified public accountant and Trump supporter, said the tipped earnings exemption represented “pandering for votes” by both candidates when he believes the focus should be on how inflation surged and led to high interest rates that have pressured small business owners in particular.”It has hurt a lot of people,” he said, adding that he holds Harris and President Joe Biden accountable for not doing more in the moment to try to curb price increases.In Las Vegas, Rocelia Mendoza gathered with colleagues at the Culinary Union Hall one afternoon last month to prepare for a day of door knocking, despite the stifling heat, to encourage other union members to vote for Harris.An assistant server at a casino restaurant, she said taxes took “too much” from the just-over $16 an hour she earns, and she’d love to “make a little bit more money for my family.”But she didn’t trust Trump to deliver.”My sister, my granddaughter, my husband, all my family is supporting Kamala Harris,” Mendoza said. More

DUBLIN (Reuters) – Ireland has leapfrogged the Bahamas to become the world’s ninth most significant tax haven, according to a ranking by pressure group the Tax Justice Network, which campaigns for tax transparency.Ireland first appearance in the global top ten puts it alongside countries such as the British Virgin Islands, which tops the list, and the Netherlands, having edged up from eleventh place in the previous report in 2021.The study measures the amount of corporate financial activity in countries, including money flows, as well as transparency and tax schemes on offer, assigning a points-based ranking. The Tax Justice Network is highly critical of Britain’s overseas territories, such as the Virgin Islands. But it also highlights the growing importance of Ireland.The list was published shortly after Ireland received $14 billion in back taxes from Apple (NASDAQ:AAPL), after the European Court of Justice said the country’s favourable tax treatment of the iPhone maker had been unlawful.A spokesperson for Ireland’s Department of Finance said Ireland was not a tax haven and that it had taken steps to tackle aggressive tax planning by reforming its tax code and that it supported international tax reform.Nessa Ni Chasaide of Ireland’s Maynooth University said Dublin had responded to criticism by changing rather than dropping favourable tax schemes, allowing international companies write off the value of intellectual property against profits to pay less tax.”Ireland plays global tax games in a very sophisticated way,” she said. “Every time it comes under pressure, it has a new game. Ireland is laughing all the way to the bank.”Corporate tax revenues have exploded in Ireland over the last decade, jumping from 4.4 billion euros in 2015 to an expected 29.5 billion euros this year, not including the Apple windfall.The receipts, mainly paid by a handful of U.S. multinationals, now make up 28% of all tax collected in Ireland each year, propelling its public finances to becoming the strongest in Europe. More

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