US Senate debates $430 billion anti-inflation bill
Sunday, 7 August 2022 (15:55 IST)
The US Senate started debating a $430 billion (€422.3 billion) climate change, healthcare and tax bill, after Vice President Kamala Harris voted in favor of the Democrats to break a tie against unanimous Republican opposition on Saturday.
"The bill, when passed, will meet all of our goals: fighting climate change, lowering healthcare costs, closing tax loopholes abused by the wealthy and reducing the deficit," Senate Majority Leader Chuck Schumer said in the Senate.
The package, called the Inflation Reduction Act, will earmark $430 billion in new spending along with raising more than $740 billion in new revenues.
If the Senate passes the bill, it would send the legislation on to the Democratic-controlled House of Representatives, which intends to take it up on Friday, after which President Joe Biden could sign it into law.
Bill to cut carbon emissions
Democrats say the legislation would address climate change by reducing US carbon emissions by 40% by 2030.
The bill also calls for billions of dollars to encourage the production of more electric vehicles and foster clean energy, offering businesses and families large incentives to encourage purchases of electric vehicles and energy-efficient appliances.
It also seeks to spur new investments in wind and solar power.
Medicare to push back on drug prices
The most popular element of the bill allows Medicare, the government health insurance program for the elderly, to negotiate drug prices as a way of reducing costs. A Reuters/Ipsos poll found 71% of respondents support the measure, including 68% of Republicans.
Expiring subsidies that help millions of people afford private insurance premiums would also be extended for three years.
A new provision creates a $35 monthly cap for insulin.
New taxes on corporations and the wealthy
The bill's tax provisions include a new 15% minimum tax on some corporations.
Reflecting Democrats' calls for tax equity, it also aims to close loopholes that the wealthy can use to avoid paying taxes.
The bill also imposes a new tax on stock buybacks, expecting to raise an additional $70 billion in tax revenue per year, according to lawmakers.
The US tax agency IRS budget would receive more funding to boost its tax collection.
But the bill is expected to face a tough battle in the US Senate, where all 50 Republican lawmakers reject the initiative. Senate Republican Leader Mitch McConnell attacked the provision involving negotiating drug prices, comparing it to past "price-fixing" attempts by countries such as Cuba, Venezuela and the former Soviet Union.
