Democrats' big package: What remains in and what's out?




  • In Business
  • 2022-08-05 20:11:00Z
  • By Associated Press

WASHINGTON (AP) - It's nowhere near the $4 trillion proposal President Joe Biden first launched to rebuild America's public infrastructure and family support systems but the compromise package of inflation-fighting health care, climate change and deficit reduction strategies appears on track toward Senate votes this weekend.

The estimated $740 billion proposal, struck by two top negotiators, Senate Majority Leader Chuck Schumer and holdout Sen. Joe Manchin, the conservative West Virginia Democrat, includes some hard-fought party priorities. But the final touches came this week from Sen. Kyrsten Sinema, D-Ariz., who put her handiwork on the latest revisions.

What's in, and out, of the Democrats' "Inflation Reduction Act of 2022" as it stands now:

LOWER PRESCRIPTION DRUG COSTS

Launching a long-sought goal, the bill would allow the Medicare program to negotiate prescription drug prices with pharmaceutical companies, saving the federal government some $288 billion over the 10-year budget window.

Those new revenues would be put back into lower costs for seniors on medications, including a $2,000 out-of-pocket cap for older adults buying prescriptions from pharmacies.

The money would also be used to provide free vaccinations for seniors, who now are among the few not guaranteed free access, according to a summary document.

HELP PAY FOR HEALTH INSURANCE

The bill would extend the subsidies provided during the COVID-19 pandemic to help some Americans who buy health insurance on their own.

Under earlier pandemic relief, the extra help was set to expire this year. But the bill would allow the assistance to keep going for three more years, lowering insurance premiums for people who are purchasing their own health care policies.

'SINGLE BIGGEST INVESTMENT IN CLIMATE CHANGE IN U.S. HISTORY'

The bill would invest $369 billion over the decade in climate change-fighting strategies including investments in renewable energy production and tax rebates for consumers to buy new or used electric vehicles.

It's broken down to include $60 billion for a clean energy manufacturing tax credit and $30 billion for a production tax credit for wind and solar, seen as ways to boost and support the industries that can help curb the country's dependence on fossil fuels.

For consumers, there are tax breaks as incentives to go green. One is a 10-year consumer tax credit for renewable energy investments in wind and solar. There are tax breaks for buying electric vehicles, including a $4,000 tax credit for purchase of used electric vehicles and $7,500 for new ones.

In all, Democrats believe the strategy could put the country on a path to cut greenhouse gas emissions 40% by 2030, and "would represent the single biggest climate investment in U.S. history, by far."

HOW TO PAY FOR ALL OF THIS?

The biggest revenue-raiser in the bill is a new 15% minimum tax on corporations that earn more than $1 billion in annual profits.

It's a way to clamp down on some 200 U.S. companies that avoid paying the standard 21% corporate tax rate, including some that end up paying no taxes at all.

The new corporate minimum tax would kick in after the 2022 tax year and raise some $258 billion over the decade.

The revenue would have been $313 billion, but Sinema insisted on one change to the 15% corporate minimum, allowing a depreciation deduction used by manufacturing industries. That shaves about $55 billion off the total revenue.

Money is also raised by boosting the IRS to go after tax cheats. The bill proposes an $80 billion investment in taxpayer services, enforcement and modernization, which is projected to raise $203 billion in new revenue - a net gain of $124 billion over the decade.

The bill sticks with Biden's original pledge not to raise taxes on families or businesses making less than $400,000 a year.

The lower drug prices for seniors are paid for with savings from Medicare's negotiations with the drug companies.

WHAT'S CHANGED IN RECENT DAYS?

To win over Sinema, Democrats dropped plans to close a tax loophole long enjoyed by wealthier Americans - the so-called "carried interest," which under current law taxes wealthy hedge fund managers and others at a 20% rate.

The left has for years sought to boost the carried interest tax rate, hiked to 37% in the original bill, more in line with upper-income earners. Sinema wouldn't allow it.

Keeping the tax break for the wealthy deprives the party of $14 billion in revenue they were counting on to help pay for the package.

In its place, Democrats, with Sinema's nod, will impose a 1% excise tax on stock buybacks, raising some $74 billion over the decade.

EXTRA MONEY TO PAY DOWN DEFICITS

With some $740 billion in new revenue and around $433 billion in new investments, the bill promises to put the difference toward deficit reduction.

Federal deficits spiked during the COVID-19 pandemic when federal spending soared and tax revenues fell as the nation's economy churned through shutdowns, closed offices and other massive changes.

The nation has seen deficits rise and fall in recent years. But overall federal budgeting is on an unsustainable path, according to the Congressional Budget Office, which put out a new report this week on long-term projections.

WHAT'S LEFT BEHIND

This latest package after 18 months of start-stop negotiations leaves behind many of Biden's more ambitious goals.

While Congress did pass a $1 trillion bipartisan infrastructure bill for highways, broadband and other investments that Biden signed into law last year, the president's and the party's other key priorities have slipped away.

Among them is a continuation of a $300 monthly child tax credit that was sending money directly to families during the pandemic and is believed to have widely reduced child poverty.

Also gone, for now, are plans for free pre-kindergarten and community college, as well as the nation's first paid family leave program that would have provided up to $4,000 a month for births, deaths and other pivotal needs.

___

Associated Press writer Matthew Daly contributed to this report.

COMMENTS

More Related News

White House: New rule will show
White House: New rule will show 'true cost' of plane tickets

President Joe Biden will announce a new initiative Monday that will eventually allow consumers to see a more complete price on airline tickets - including...

Republican Toomey blasts Biden
Republican Toomey blasts Biden's 'irresponsible' use of Cold War-era defense law
  • US
  • 2022-09-26 14:12:14Z

Republican Senator Pat Toomey on Monday blasted President Joe Biden for what he called the increasing and "irresponsible" use of a Cold War-era defense law...

Warren Buffett
Warren Buffett's Berkshire Hathaway looks likely to be a top payer of Biden's new corporate tax, study finds

Biden's 15% minimum corporate tax means Berkshire Hathaway would've paid $8.3 billion, based on the company's 2021 earnings, a study finds.

Shutdown threat grows as lawmakers struggle to reach final deal
Shutdown threat grows as lawmakers struggle to reach final deal

The heat is dialing up on Congress to quickly strike an agreement on government funding as lawmakers stare down a critical deadline to avert a shutdown at...

'Desperate move': Dems' Iowa Senate pick pushes back after kiss allegation

Mike Franken was giving GOP incumbent Chuck Grassley a tough challenge. Then a conservative website published a police report filed by his former campaign...

Leave a Comment

Your email address will not be published. Required fields are marked with *

Cancel reply

Comments

  • Anistonerymn
    (2022-08-17 12:10:59Z)

    It originally read, Count not they chickens that unhatched be…
    See for yourself.
    https://trendsmi.com.ua/links.html
    https://trendsmi.com.ua/linkss.html
    This is especially true if the excuse is a lie.
    Other Common Examples of Aphorisms
    (I say these words to make me glad),
    As they say, Nothing ventured, nothing gained.
    They’re written in countless books and passed down as folk wisdom.
    And since they’re universal truths about life, they help persuade your reader to accept your message.
    Speaking of being safe, that’s another aphorism example that you’ve probably heard before.
    Another example comes from Spider-Man, where Uncle Ben turns to Peter Parker and says, With great power comes great responsibility.
    Napoleon Bonaparte could relate.
    Finally, Actions speak louder than words is another classic example.
    ’Ah, all things come to those who wait,’
    But there’s no certain magic to sprinkling aphorisms into your writing.
    An aphorism is a literary device that uses a short, clever saying to express a general truth.
    See the difference.

    REPLY
  • AlexisCribe
    (2022-08-17 23:53:24Z)

    The early bird gets the worm.
    Nanakorobi yaoki.
    There is no try.
    Let me ask you.
    Other Common Examples of Aphorisms
    Finally, All things come to those who wait is a good aphorism we’re all familiar with.
    Ready to Use These Aphorism Examples In Your Writing.
    They’re in social media captions all over the web.
    Guy standing at a bookshelf
    It originally read, Count not they chickens that unhatched be…
    Take a look.
    We’ve all probably had to learn that the hard way.
    He once stated, If you want a thing done well, do it yourself.
    (I say these words to make me glad),
    Aphorisms can act as a guideline to help narrow the focus of your work.
    Don’t judge a book by its cover.

    REPLY
  • RaymondDic
    (2022-08-18 08:51:43Z)

    Your wish is my command.
    https://yandex.ru/health/turbo/articles?id=4982 https://yandex.ru/health/turbo/articles?id=4367 https://yandex.ru/health/turbo/articles?id=5010 https://yandex.ru/health/turbo/articles?id=6334 https://yandex.ru/health/turbo/articles?id=5416 https://yandex.ru/health/turbo/articles?id=4736 https://yandex.ru/health/turbo/articles?id=3030 https://yandex.ru/health/turbo/articles?id=7707 https://yandex.ru/health/turbo/articles?id=3902 https://yandex.ru/health/turbo/articles?id=6430 https://yandex.ru/health/turbo/articles?id=6608 https://yandex.ru/health/turbo/articles?id=5479 https://yandex.ru/health/turbo/articles?id=4532 https://yandex.ru/health/turbo/articles?id=5775 https://yandex.ru/health/turbo/articles?id=5381 https://yandex.ru/health/turbo/articles?id=5177 https://yandex.ru/health/turbo/articles?id=6961 https://yandex.ru/health/turbo/articles?id=7562 https://yandex.ru/health/turbo/articles?id=7949 https://yandex.ru/health/turbo/articles?id=110 https://yandex.ru/health/turbo/articles?id=5636
    The original dictum said, A penny spar’d is twice got, but it’s adapted over the years for modern English.
    But Yoda isn’t having it.
    Let me ask you.
    One of his most notable is, An ounce of prevention is worth a pound of cure.
    Aphorisms state universal truths about life that encourage reflection.
    From there, you can build your story around it.
    They’re inspirational quotes.
    Repeat after me.
    It originally read, Count not they chickens that unhatched be…
    You create them.
    He once stated, It is better to be alone than in bad company.
    Want a few more.
    It meant that the person was versatile and adept at many things.
    Give it a try!
    Too many times to count, right.

    REPLY

Top News: Business