El Capitolio en Washington D. C.
US Capitol. (Shutterstock)

Washington - Senate Democrats reached a “final” agreement that could secure the support of the entire caucus for the new budget reconciliation bill addressing tax, health care, and climate change that they want to pass this weekend.

Kyrsten Sinema’s (Arizona) decision to support the legislation, once the amendments required are included, may ensure that the entire Democratic caucus will vote in favor of a measure that allows to bypass the filibuster rule and represent a victory for President Joe Biden.

“The agreement preserves the major components of the Inflation Reduction Act, including reducing prescription drug costs, fighting climate change, closing tax loopholes exploited by big corporations and the wealthy,” said Senate Majority Leader Chuck Schumer.

President Biden said the agreement is “another critical step toward reducing inflation and the cost of living for America’s families” and added that he looked “forward to the Senate taking up this legislation and passing it as soon as possible”.

The Senate expects to begin debating the measure today, seeking to pass it early next week. The House, meanwhile, may briefly suspend its August recess to consider it before the end of the month.

The legislation has an impact of about $750 billion, nearly two-thirds less than the original proposal with President Biden’s social initiatives, which the House passed in November 2021.

“The Inflation Reduction Act will help Americans save money on prescription drugs, health premiums, and much more.  It will make our tax system more fair by making corporations pay a minimum tax. (15 percent),” said Biden.

The legislation will allow Medicare to directly negotiate with drug companies. It also allows for the extension of Obamacare subsidies in the U.S., not in its territories.

When a preliminary between Schumer and Democratic Senator Joe Manchin (Virginia) was announced, the proposal included $433 billion in new spending and $313 billion in revenues.

The revenue would come from a 15 percent corporate minimum tax with at least $1 billion in profits on their financial statements and an increase in tax rates for citizens earning more than $400,000 annually. The agreement promotes tax credits for those who buy electric vehicles.

Senator Sinema supported the legislation after leaders agreed to remove a $14 billion tax increase for some hedge fund managers and private equity executives, and changing the structure of the 15 percent corporate minimum tax.

But Schumer said the new buyback tax compensates for two changes that Sinema demanded. The measure will generate $74 billion in revenue.

The original bill approved in the House would have provided tens of billions of dollars to Puerto Rico, including extending the Supplemental Security Income (SSI) program to island residents and improved access to Medicaid funds. It also proposed jobs tax credits for U.S. corporations investing in the territories.

💬See comments