Senate Majority Leader Chuck Schumer, D-N.Y., and Sen. Joe Manchin, D-W.V., announced Wednesday that they have reached a long-awaited agreement on legislation aimed at overhauling the tax code, fight climate change and reduce health. – care expenses.
The reconciliation bill would invest more than $400 billion over 10 years, to be paid for entirely by closing tax loopholes for the wealthiest Americans and corporations, the senators said in a joint statement. It would reduce deficits by $300 billion over this decade, the senators said, citing estimates from the nonpartisan Congressional Budget and Fiscal Office.
The package would raise about $739 billion, including:
$313 billion through a 15% corporate minimum tax $288 billion through prescription drug pricing reforms, including measures to allow Medicare to negotiate drug prices and limit out-of-pocket costs to $2 billion dollars through the IRS’s implementation of a $14 billion reformed tax code. closing the interest gap
The bill would also invest a total of $433 billion in:
$369 billion from a suite of energy and climate-related programs.
The full Senate will consider the bill next week, Schumer and Manchin said. They expect the legislation to comply with Senate lawmaker budget reconciliation rules, allowing Democrats to pass it without requiring Republican votes.
Democrats’ minimum majority in the Senate includes Sen. Bernie Sanders, I-Vt., who caucuses with Democrats, and Vice President Kamala Harris’ ability to cast the tie-breaking vote. With a single defection, Democrats’ hopes of passing any strictly partisan legislation will be dashed.
Manchin has flexed that power before: In December, he announced he would refuse to back President Joe Biden’s $1.75 trillion plan to fund a range of social and climate issues. The White House then accused him of breaking his promises to the Biden administration.
Biden, who made a similar but broader proposal a centerpiece of his first-term domestic agenda, praised the senators’ deal on Wednesday.
“This is the action the American people have been waiting for,” he said in a statement of support.
“This addresses today’s issues — high health care costs and general inflation — as well as investments in our energy security for the future,” the president said.
Schumer and Manchin pitched the package as a way to fight runaway inflation while addressing other issues on the Democratic agenda, including cutting carbon emissions by 40 percent by 2030.
The package was revealed hours after the Senate approved a bipartisan bill aimed at increasing US competitiveness with China by subsidizing domestic semiconductor production.
Senate Minority Leader Mitch McConnell, R-Ky., had previously warned that Republicans would not support the China competition bill if Democrats continued to pursue unrelated reconciliation legislation.
McConnell’s spokespeople did not immediately respond to CNBC’s request for comment.
The deal’s provisions surprised many after Manchin, just weeks earlier, signaled his reluctance to quickly endorse the Biden administration’s climate agenda. because of his concern about inflation. Manchin’s stance angered some of his colleagues who have expressed frustration with the conservative Democrat’s excessive power in the Senate, which is split 50-50 with Republicans.
Schumer had said earlier this month that Democrats would work a thinner ticket which addressed drug pricing and health care financing.
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