The United States Senate prepares a large tax, climate and health law after the agreement with Sinema

The United States Senate prepares a large tax, climate and health law after the agreement with Sinema

The US Senate Democrats’ sweeping tax, climate and health bill looks set to be passed after Majority Leader Chuck Schumer and Senator Kyrsten Sinema of Arizona struck a deal to soften the rise of the US Senate. ‘The measure’s corporate tax and a second tax hike targeting wealthy financial sector workers, Schumer told reporters on Friday.

The revenue lost to gain Sinema’s support would more than make up for with a new provision aimed at stock repurchases, Schumer said.

Democrats are also likely to add up to $ 5 billion for the Bureau of Reclamation to address drought resilience in the Colorado River Basin, people familiar with those negotiations said. The basin encompasses all of Arizona and parts of Colorado, New Mexico, Nevada, California, Utah, and Wyoming.

Schumer’s deal with Sinema, an influential moderate seen as the last resistance to the bill, likely put the legislation on the path to unanimity among the 50 Democrats in the Senate. This is a requirement for the bill to pass as part of a legislative process known as reconciliation that allows Democrats to bypass the House’s normal 60-vote threshold.

Vice President Kamala Harris is expected to break a party tie on a vote for the bill’s final approval.

The concessions to Sinema included the removal of a provision that changes the way certain hedge fund managers and private equity executives are taxed, known as reported interest, Schumer said.

The New York Democrat said he strongly supported the tax change, but that was a red line for Sinema.

“I pushed for it to be on this bill,” Schumer said. “Sen. Sinema said she wouldn’t vote for the bill – she wouldn’t even move to proceed – unless we eliminated it. So we had no choice. “

The non-party congressional budget office estimated the measure would increase revenue by $ 14 billion over 10 years.

The Schumer-Sinema agreement would also amend a separate provision that establishes a new minimum rate of 15% for companies with income equal to or greater than $ 1 billion.

Schumer did not provide details of the change, saying only “one piece was taken away,” but said it would reduce the projected revenue the supply would produce from $ 313 billion to $ 258 billion.

The tax revenue lost in removing these two provisions would be offset with a new excise tax on share buybacks, in which public companies buy their shares on the open market to reduce the publicly available amount and raise the price.

Schumer said he “hates” the buyback process because the money companies spend on it could otherwise be spent on creating jobs or research and development.

The excise tax would bring in $ 74 billion, he said, and should be encouraging for the progressive wing of the caucus.

Those changes would add an additional $ 5 billion in revenue, the exact amount Sinema is looking for in additional drought resilience funding.

The exact figure for drought resilience spending was still a matter of debate among Senate Democrats on Friday afternoon, but it was expected to run into billions of dollars, sources said.

‘It will be like hell’

A handful of Senate Republicans criticized the bill from all angles during a Friday morning media coverage and indicated that they would make the change process as painful as possible for Democrats.

All GOP senators should oppose the bill in the courtroom.

Senator Roger Marshall, a Kansas gynecologist prior to joining the Senate, said changes to the bill to allow Medicare to negotiate the prices of certain prescription drugs would harm drug development in the pharmaceutical industry.

“Why do they want to destroy the innovations that the pharmaceutical industry has given us that have saved millions of lives?” Marshall said.

Senator Bill Cassidy of Louisiana said the bill would do little to address inflation, despite the Democrats’ title for the bill: the Inflation Reduction Act.

Tax breaks for electric vehicles, for example, would have little impact on Louisianans struggling to fill their gas tanks, he said.

“If their prescription for high fuel prices is for someone to drive an electric vehicle, they have no understanding of the life of those people I represent,” he said. ‚ÄúPeople don’t drive 15-year-old pickup trucks because they don’t want a new car. They don’t drive new cars because they can’t afford a new car. And the high gas prices have made things even worse. “

Senator John Barrasso of Wyoming, the Republican in rank on the Senate Energy and Natural Resources Committee, said the measure would increase the energy costs that are driving inflation.

Democrats said spending the clean energy bill would cut energy bills. The measure also includes provisions to promote fossil fuel development, negotiated with Schumer by moderate West Virginia Democratic Senator Joe Manchin III.

Republicans will propose amendments to the “energy, inflation, border and crime” bill to force Democrats to hard votes, said Barrasso, member No. 3 of the Republican leadership in the House.

Senator Lindsey Graham of South Carolina said Democrats “deserve” a tough string of votes because they outsmarted Republicans to win GOP support for a bill to increase semiconductor production while keeping the bill alive. Spending Act for Democrats Only.

Minority leader Mitch McConnell had indicated he would not support the semiconductor bill if the Democrats still planned to pursue a reconciliation bill. But several Republicans voted yes to that measure last week, only to see a 725-page Schumer-Manchin bill come out hours later.

“So what will it be like to vote for a rama?” Graham said. “It will be like hell.”

Weekend session

Schumer said the Senate will meet on Saturday to begin consideration of the bill.

The Senate MP, an official tasked with determining whether each section of the bill could be part of the conciliation process reserved for legislation with the greatest effect on the federal budget, was still reviewing the provision on Friday.

Once the Senate has voted to proceed with the discussion of the bill, scheduled for Saturday afternoon, the House would have 20 hours to discuss it, so unlimited time to consider the amendments at a rapid pace in what is called a “vote-to-“. rama “.

The final vote is scheduled for Sunday or Monday. House Majority Leader Steny Hoyer of Maryland said the House would return from its hiatus on August 12 to accept the bill.

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