Image source: NBC News
President Joe Biden and his party bagged a significant victory when the Senate passed the $750 billion Democratic Health, Tax and Climate Bill.
The bill, called the Inflation Reduction Act, represents the most significant climate investment in US history.
It adds significant changes to health policy, giving Medicare the power to negotiate the prices of certain prescription drugs — the first time in history to do so.
In addition, the bill extends the declining health allowance by three years.
The Inflation Reduction Act reduces the deficit, which must be paid for through new taxes, including a minimum 15% tax on large corporations and a 1% tax on share buybacks.
It also increases the collection capacity of the tax authorities.
The bill will generate more than $ 700 billion in government revenue over ten years.
It is also spending more than $ 430 billion to reduce carbon emissions and expand health insurance subsidies under the Affordable Care Act and use the remaining new revenue to reduce the deficit.
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The party’s final vote was 51-50, in favor of the bill rejected when Vice President Kamala Harris broke the deadlock.
Senate Democrats have shown a united front to pass the legislation, using a single filibuster-proof process to pass the bill without Republican votes.
The latest decision came after a series of controversial changes called “vote-a-rama,” which lasted nearly 16 hours from Saturday evening to Sunday afternoon.
How the law was passed in a party-line vote
Senate Democrats are hoping for an opportunity to sign a bill that could include essential items on the party’s agenda.
However, they struggled for months to reach an agreement that could win their faction’s full support.
West Virginia Democratic Senator Joe Manchin was instrumental in crafting the legislation.
Things accelerated when he and Senate Leader Chuck Schumer announced a settlement in late July, a big step forward for Democrats after initial negotiations stalled.
On Thursday, Arizona Senator Kyrsten Sinema offered critical support after leaders agreed to amend the new tax proposals.
The senators worked all weekend to make crucial changes to the bill.
To prevent the bill from failing at the last minute, Democrats have devised a plan to acquire Sinema, particularly concerned about the impact of the 15% corporation tax on private equity subsidiaries.
As a compromise, the Democrats in the Senate accepted a more restrictive tax bill.
While the South Dakota Senate has proposed paying GOP Whip John Thune through an amendment to state and local tax deductions, it has extended the limit on the number of losses companies can deduct by an additional two years.
They switched to ensure Coastal District House Democrats don’t break the agreement.
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“I think we’ll all benefit from it; the country will,” said Senator Joe Manchin.
“We have energy security, that’s what we’re looking for. And we have the ability to invest in the energy of the future.”
Meanwhile, US President Joe Biden praised the Senate for passing the bill.
In a released statement, Biden thanked House Democrats and touted the legislation’s climate investments and health care. The statement reads:
“Today, Senate Democrats sided with American families over special interests, voting to lower the cost of prescription drugs, health insurance, and everyday energy costs and reduce the deficit, while making the wealthiest corporations finally pay their fair share.”
When the Senate passed the bill, Sinema released a statement saying it would “help Arizonans build better lives for themselves and their families by lowering prices, making health care more affordable and accessible, and securing Arizona’s water and energy future.”
Meanwhile, New Jersey representative Josh Gottheimer, who was originally part of the “No SALT, no Deal” caucus, said the bill passed the test because it failed to raise unemployment rates and taxation of individuals.
New Jersey adviser Mikie Sherrill agreed with Gottheimer, saying:
“I will also remain steadfast in my commitment to ensuring that any discussion of reforms to the 2017 tax law begins with addressing SALT.”
“Because this legislation does not raise taxes on families in my district, but in fact significantly lowers their costs, I will be voting for it.”
Senate passes Democrats’ sweeping health care and climate bill