Small business owners may soon be in for a lengthy and expensive battle with the IRS, tax experts warn.
A key provision in the Inflation Reduction Act — which throws an extra $80 billion to the IRS to improve the agency’s collection of under-reported income — will end up targeting small business owners to pay for the legislation, according to nonpartisan watchdog the Joint Committee on Taxation.
The group estimates that between 78% and 90% of the estimated additional $200 billion the IRS will collect will come from small businesses making less than $200,000 annually.
Just 4% to 9% would come from businesses making north of $500,000 a year — meaning the legislation is in sharp contrast to President Biden’s longstanding claim that he wouldn’t raise taxes on anyone making less than $400,000.
“The IRS will have to target small and medium businesses because they won’t fight back,” Joe Hinchman, executive vice president at the National Taxpayers Union Foundation, told The Post. “We’ve seen this play out before … the IRS says ‘We’re going after the rich’ but when you’re trying to raise that much money, the rich can only get you so far.”
Increasing the number of IRS agents could hurt small businesses most.Getty Images
In fact, going after the lower and middle class can actually be more lucrative for IRS auditors than trying to get more money from the wealthy. “The rich have their lawyers and fight it — that’s why the poor are easier to go after,” Hinchman adds.
Accordingly, tax experts warn that the IRS’s audits will be far more painful and costly for small business owners — even for those who think they’re filing their taxes correctly.
Sens. Joe Manchin and Chuck Schumer have reached a deal that would give the IRS an extra $80 billion.Getty Images
“Most small businesses aren’t doing anything wrong,” Daniel Bunn, executive vice president at the Tax Foundation, told The Post. “We don’t make the tax code simple and the complicated tax code makes it difficult for small business owners to comply with all the requirements.”
Even if small business owners get everything right, they may still be faced with a headache since part of the IRS expansion will involve sending out more notices and letters to businesses, Bunn adds. For individual contractors or small businesses, an IRS letter that they owe more money or made an error on their taxes can put them underwater.
“Anytime you get an IRS letter, it could take months or years to get it settled — we’re talking many thousands of dollars to address,” Bunn added. “Large companies have constant reviews and lawyers going through everything… small business doesn’t have the resources to fight back in the way.”
The White House has dismissed claims the bill will hurt lower- and middle-income Americans, instead noting the JCT estimate doesn’t take into account how much the bill will offset costs for average Americans like prescription drugs.
But tax experts aren’t so sanguine about the reality of giving the IRS more resources.
“The approach here is to double the IRS workforce, take the leash off, and see how much they can collect,” Hinchman adds. “I think they’ll collect it but it will be quite painful.”
Small business owners may soon be in for a lengthy and expensive battle with the IRS, tax experts warn.
A key provision in the Inflation Reduction Act — which throws an extra $80 billion to the IRS to improve the agency’s collection of under-reported income — will end up targeting small business owners to pay for the legislation, according to nonpartisan watchdog the Joint Committee on Taxation.
The group estimates that between 78% and 90% of the estimated additional $200 billion the IRS will collect will come from small businesses making less than $200,000 annually.
Just 4% to 9% would come from businesses making north of $500,000 a year — meaning the legislation is in sharp contrast to President Biden’s longstanding claim that he wouldn’t raise taxes on anyone making less than $400,000.
“The IRS will have to target small and medium businesses because they won’t fight back,” Joe Hinchman, executive vice president at the National Taxpayers Union Foundation, told The Post. “We’ve seen this play out before … the IRS says ‘We’re going after the rich’ but when you’re trying to raise that much money, the rich can only get you so far.”
Increasing the number of IRS agents could hurt small businesses most.Getty Images
In fact, going after the lower and middle class can actually be more lucrative for IRS auditors than trying to get more money from the wealthy. “The rich have their lawyers and fight it — that’s why the poor are easier to go after,” Hinchman adds.
Accordingly, tax experts warn that the IRS’s audits will be far more painful and costly for small business owners — even for those who think they’re filing their taxes correctly.
Sens. Joe Manchin and Chuck Schumer have reached a deal that would give the IRS an extra $80 billion.Getty Images
“Most small businesses aren’t doing anything wrong,” Daniel Bunn, executive vice president at the Tax Foundation, told The Post. “We don’t make the tax code simple and the complicated tax code makes it difficult for small business owners to comply with all the requirements.”
Even if small business owners get everything right, they may still be faced with a headache since part of the IRS expansion will involve sending out more notices and letters to businesses, Bunn adds. For individual contractors or small businesses, an IRS letter that they owe more money or made an error on their taxes can put them underwater.
“Anytime you get an IRS letter, it could take months or years to get it settled — we’re talking many thousands of dollars to address,” Bunn added. “Large companies have constant reviews and lawyers going through everything… small business doesn’t have the resources to fight back in the way.”
The White House has dismissed claims the bill will hurt lower- and middle-income Americans, instead noting the JCT estimate doesn’t take into account how much the bill will offset costs for average Americans like prescription drugs.
But tax experts aren’t so sanguine about the reality of giving the IRS more resources.
“The approach here is to double the IRS workforce, take the leash off, and see how much they can collect,” Hinchman adds. “I think they’ll collect it but it will be quite painful.”
The West Virginia Coal Association and several other state-based coal industry groups on Wednesday blasted the tax and climate deal that Sen. Joe Manchin (DW.Va.) agreed to last week, warning it will “severely threaten American coal” and an estimated 381,000 jobs.
“This legislation is so egregious, it leaves those of us that call Sen. Manchin a friend, shocked and disheartened,” the groups wrote in a blistering statement that accused the West Virginia senator of zigzagging in the energy debate.
“Sen. Manchin has seemingly fought against numerous climate measures advanced over the past year by the national democratic establishment,” the groups said. “The current Schumer-Manchin draft agreement on climate and energy frankly leaves us questioning the motivation and sincerity of Manchin’s previous stance and his repeated chant from him: we must ‘innovate not eliminate.’”
The groups warn the deal Manchin crafted with Senate Majority Leader Charles Schumer (DN.Y.) after months of negotiation “will quickly diminish our coal producing operations and all but obviate any need to innovate coal assets.”
The groups argue the bill — which Democrats have dubbed the Inflation Reduction Act and plan to pass this weekend — will do “nothing for coal or coal generation” and won’t reduce inflation or lower household energy costs.
“By turbocharging the lofty incentives that already extend to renewable energy, our nation’s baseload (reliable) coal electric generation assets will continue to be devalued and thrust into rapid decline,” the groups warned.
The statement was signed by Chris Hamilton, the president of the West Virginia Coal Association, as well as the leaders of the Kentucky, Illinois, Indiana, Ohio, Pennsylvania, Texas and Wyoming mining associations.
Manchin on Tuesday said he didn’t agree with predictions the bill will lead to coal plants closing in his state.
“I don’t think that’s the case at all,” he told reporters. “We have to have a vibrant fossil industry. We have a lot of coal plants that have been pretty old.”
“Coal is going to be needed for the base load that we’re going to have to have,” he said, arguing that coal will continue to generate enough electricity to meet minimum domestic demand.
Manchin also cited permitting reform, an initiative he is pushing in conjunction with the energy and climate provisions in the budget bill, as something that will also help fossil fuel producers.
The West Virginia Coal Association and several other state-based coal industry groups on Wednesday blasted the tax and climate deal that Sen. Joe Manchin (DW.Va.) agreed to last week, warning it will “severely threaten American coal” and an estimated 381,000 jobs.
“This legislation is so egregious, it leaves those of us that call Sen. Manchin a friend, shocked and disheartened,” the groups wrote in a blistering statement that accused the West Virginia senator of zigzagging in the energy debate.
“Sen. Manchin has seemingly fought against numerous climate measures advanced over the past year by the national democratic establishment,” the groups said. “The current Schumer-Manchin draft agreement on climate and energy frankly leaves us questioning the motivation and sincerity of Manchin’s previous stance and his repeated chant from him: we must ‘innovate not eliminate.’”
The groups warn the deal Manchin crafted with Senate Majority Leader Charles Schumer (DN.Y.) after months of negotiation “will quickly diminish our coal producing operations and all but obviate any need to innovate coal assets.”
The groups argue the bill — which Democrats have dubbed the Inflation Reduction Act and plan to pass this weekend — will do “nothing for coal or coal generation” and won’t reduce inflation or lower household energy costs.
“By turbocharging the lofty incentives that already extend to renewable energy, our nation’s baseload (reliable) coal electric generation assets will continue to be devalued and thrust into rapid decline,” the groups warned.
The statement was signed by Chris Hamilton, the president of the West Virginia Coal Association, as well as the leaders of the Kentucky, Illinois, Indiana, Ohio, Pennsylvania, Texas and Wyoming mining associations.
Manchin on Tuesday said he didn’t agree with predictions the bill will lead to coal plants closing in his state.
“I don’t think that’s the case at all,” he told reporters. “We have to have a vibrant fossil industry. We have a lot of coal plants that have been pretty old.”
“Coal is going to be needed for the base load that we’re going to have to have,” he said, arguing that coal will continue to generate enough electricity to meet minimum domestic demand.
Manchin also cited permitting reform, an initiative he is pushing in conjunction with the energy and climate provisions in the budget bill, as something that will also help fossil fuel producers.
Sen. Kyrsten Sinema (D-Ariz.) is eyeing changes to Democrats’ $740 billion reconciliation bill — specifically increasing climate funding and restructuring the tax provisions — as the Senate moves rapidly toward final passage before the August recess, Axios has learned.
Why it matters: Sinema is the one senator potentially standing in the way of Democrats clinching President Biden’s longtime goal of passing an ambitious package tackling climate change, health care and taxes — renamed the “Inflation Reduction Act of 2022.”
That position gives her a huge amount of leverage as Democrats await a verdict from the Senate parliamentarian on whether the bill complies with the “Byrd Rule,” which controls what provisions can be included in the budget reconciliation process.
The fact the negotiations were conducted entirely in secret between Senate Majority Leader Chuck Schumer (DN.Y.) and Sen. Joe Manchin (DW.V.) — catching Sinema by surprise — has left her space for an 11th hour intervention.
Sinema has so far refused to weigh in on whether or not she will support the bill until the parliamentarian renders her judgment on the measure.
What we’re hearing: Sinema is looking at significantly beefing up the reconciliation bill’s funding for droughts and water security in the Southwest, sources familiar with her thought process tell Axios.
She views the current $369 billion climate and energy portion of the bill as insufficient for addressing threat resilience funding.
On taxes, Sinema has concerns with the structure of the 15% corporate minimum “book tax” and whether the burden could get passed down to employees, the sources said.
Sinema supports cracking down on tax avoidance, but has long voiced her opposition to closing the carried interest loophole.
She’s concerned that the provision, which would contribute $14 billion toward paying down the bill’s $740 billion total, could undermine economic competitiveness, the sources said.
Behind-the-scenes: Sinema has been meeting privately, both virtually and in-person, with key stakeholders in Arizona as she continues to work through her assessment of the bill.
Sinema last week visited Flagstaff, Arizona, where she met with local officials who are still reeling from recent flooding and a wildfire that ravaged the state.
Arizona is one of the fastest-warming states in the US, and the state’s largest county, Maricopa County, has already hit a record for heat-related deaths this year.
“There are some who were surprised to learn Kyrsten was enthusiastic about the climate provisions last year, because they rightly consider her a centrist. But she’s a Senator from Arizona, first and foremost,” John LaBombard, Sinema’s former communications director and SVP at ROKK Solutions tells Axios.
in to phone call tuesday with Arizona’s Chamber of Commerce, local business leaders and manufacturers discussed with Sinema what the proposed 15% corporate minimum tax and closure of the carried interest loophole would mean for Arizona.
The private equity industry, which has contributed heavily to Sinema, is lobbying her heavily on shooting down the carried interest portion.
“I remember last year, she was hearing feedback from small business owners, concerned about the potential implications of any tax policy changes, and how it might affect their capital investment streams,'” LaBombard said.
“She is somebody who errs on the side of caution when it comes to changing tax policies. … obviously, I think [their input] shaped where she is on the economic parts of this bill.”
What they’re saying: “What’s clear from our conversation is she’s taking a thoughtful and diligent approach as she considers her position on this legislation,” Danny Seiden, CEO of the Arizona Chamber, told Axios’ Hans Nichols.
“She was very interested in learning what specific impacts the tax provisions will have on Arizona manufacturers — and we believe she will consider these implications seriously as negotiations continue over the coming days.”
Fox News anchor Harris Faulkner briefly lost it during a contentious interview with Sen. Joe Manchin (D-WV) on Tuesday, taking a strong issue with the centrist senator asking her if she’s afraid of Democrats doing “something good” for America.
“My father served,” an incensed Faulkner fired back at Manchin at one point, demanding that the West Virginia lawmaker not make it “personal.”
With Manchin taking a media victory lap after finally striking a deal with Senate Majority Leader Chuck Schumer to pass portions of President Joe Biden’s economic agenda, Fox News has quickly turned on their favorite Democrat. After praising him for months for tanking Biden’s Build Back Better legislation, the network’s “disappointed” hosts and commentators have groused about Manchin’s “betrayal.”
Appearing on The Faulkner Focus on Tuesday to explain his support for the newly named Inflation Reduction Act, Manchin parried most of Faulkner’s pointed questions about the bill’s tax structure, spending, and energy investments. For the most part, Manchin continued his appeal to the patriotism of both the anchor and the network’s viewers.
“We need more energy today so—we also need to invest in the energy for the future,” Manchin declared early in the interview. “This is a balanced approach everyone has been talking about. Everyone is upset for whatever reason because they are afraid it is a political bill. It is not a Democratic bill. Not a Republican bill. It is not a green deal. This is a red, white, and blue deal, Harris.”
Manchin also pushed back when Faulkner parroted Republican claims that the new legislation would raise taxes on middle-class Americans, noting that it merely requires large corporations to pay a minimum tax rate of 15 percent.
“Who is paying any taxes that doesn’t have a corporation that has revenue of over a billion dollars a year? Not one person,” the West Virginia senator replied.
“I am asking you a different question than you’re answering. I’m saying Americans $400,000 and below are now going to be taxed. Their taxes will go up,” Faulkner replied.
“That’s wrong,” Manchin retort. “That’s a lie. A pure, outright lie.”
The conversation only grew more tense when Manchin taunted the Fox News host, at one point urging her to “be optimistic” and “be an American” when she said experts predict US gas prices will rise around Labor Day.
Eventually, Faulkner brought up Manchin’s non-response when recently grilled by Meet the Press moderator Chuck Todd on whether he wanted Democrats to stay in power after this year’s midterms. Insisting he didn’t dodge the question, Manchin instead said he is solely focused on getting his deal passed and is unconcerned with political races.
Faulkner, however, continued to press the issue, bringing up Biden’s low approval numbers while stating that “elections are going to need some help” for Democrats.
“Harris, are you scared that we’re going to do something good that will help our country?” Manchin shot back, prompting the Fox anchor to grow apoplectic.
“Of course not! My father served!” Faulkner shouted.
“Well, sounds like you are,” Manchin calmly interjected.
“Are you kidding? Service is in the Bible!” Faulkner continued. “That’s what we do, we serve our fellow man and woman. Of course! Don’t make this personal, because it’s not.”
After that heated moment, Faulkner again pushed Manchin on the low approval ratings Biden is “rocking right now,” remarking that the West Virginia senator doesn’t sound very supportive of his own party.
“I work with what I have here in the majority party we have as a Democratic Party. I’m working with the president, who has accepted the proposal I put forward and negotiated,” Manchin responded. Balanced energy policy. It’s wonderful for our country. I know people who don’t like the president and don’t like Democrats might be upset. It is not whether you like the president or you like Democrats. Do you like America? Do you want to fight inflation? This bill does it.”
The $739 billion Democratic spending plan dubbed the Inflation Reduction Act will barely affect prices over the next decade, experts say — and even the White House admitted it Monday.
According to Moody’s Analytics chief economist Mark Zandi, the 725-page bill hammered out by Sens. Chuck Schumer (D-NY) and Joe Manchin (D-WV) would only lower the Consumer Price Index – a closely watched gauge that measures what consumers paid for goods and services –0.33% by 2031.
“Through the middle of this decade the impact of the legislation on inflation is marginal, but it becomes more meaningful later in the decade,” Zandi wrote.
Jesse Lee, a senior communications adviser to the National Economic Council, was quick to tout Zandi’s findingstweeting, “This is actually the overwhelming consensus.”
“White House officials’ own rosiest, best-case-scenario spin is that their ‘Inflation Reduction Act’ will have taken one third of one percentage point off inflation by nine years from now?” Andrew Quinn, a speechwriter for Senate Minority Leader Mitch McConnell (R-Ky.), asked incredulously.
“White House comms spiking the ball over a bill that doesn’t reduce inflation until 9 years from now,” mocked Heritage Foundation spokesman Jon Cooper. “And keep in mind, this is obviously the best number they could come up with.”
The White House admitted the Inflation Reduction Act from Sens. Joe Manchin and Chuck Schumer won’t impact prices much over the next decade.Photo by Anna Moneymaker/Getty Images
Schumer and Manchin have claimed the bill would reduce inflation by lowering prescription drug and energy costs while reducing the federal budget deficit through a 15% minimum tax on corporations that report income of at least $1 billion per year, and increased tax enforcement by the IRS, and increased tax enforcement by the IRS. taking a share of profits earned by general partners at private equity, hedge funds, and venture capital firms known as carried interest.
However, experts say the inflation cure prescribed by the Democrats is likely to be ineffective, and could be worse than the disease.
Alex Muresianu, a federal policy analyst with the Tax Foundation, told The Post on Monday that the corporate tax – also called the “book minimum tax” — would “reduce supply in the long-run by reducing incentives to invest, particularly for manufacturing firms .”
“Meanwhile, on the demand-side, by taking money out of the economy, tax increases in excess of the spending attached could reduce inflation incrementally, but there are a couple problems,” he added. “First, in the first couple years, the bill does not net reduce the deficit — most of the net reduction in the deficit over the ten-year window comes in later years.
Schumer and Manchin claimed the bill would lower prescription drug and energy costs. Photo by Drew Angerer/Getty Images
“And second, the tax increases like the book minimum tax are not focused on taxpayers with high marginal propensity to consume, meaning the tax increase does not come with a particularly large reduction in aggregate demand.
“So, on the whole,” Muresianu concluded, “we should expect the bill to have a negligible impact on inflation. The Federal Reserve’s choices will play a much bigger role in whether or not inflation subsides than whether or not this bill passes.”
Levon Galstyan, a Certified Public Accountant with Jersey City-based Oak View Law Group, agreed, noting: The Inflation Reduction Act will shift resources through hundreds of billions of dollars in special-interest subsidies targeted to Democratic constituencies, further limiting supply through restrictions and tax increases.
“A deterrent to output would be that manufacturers would pay around half of all new levies,” Galstyan also told The Post. “The legislation would subject small businesses to a horde of tax enforcers, driving up prices and limiting their capacity to serve customers.”
According to Moody’s Analytics chief economist Mark Zandi, the bill would only lower the Consumer Price Index by 0.33% by 2031.AP Photo/Alex Brandon
Peter Morici, an economist and professor emeritus at the RH Smith School of Business at the University of Maryland, also argued that there was almost no chance the legislation would reduce prices.
“One of the Fed bank presidents [Neel Kashkari of Minneapolis] came out [Sunday] morning … saying we’re going to get inflation down at 2%. If you believe that, then I want you to go to Yankee Stadium on Sunday afternoon and look for me playing shortstop,” Morici told The Post.
“I’m 73 years old. I was a pretty damn good middle infielder, but I didn’t have much of a career because I never could hit the breaking ball,” he added. “I mean, that’s as credible as I’m gonna play shortstop for the New York Yankees.”
Other experts have pointed out that the legislation fails to provide a long-term solution for bringing down inflation.
“Inflation results from deep-set, fundamental issues and this bill does nothing to address those factors,” said James Lucier, managing director at Washington-based policy research firm Capital Alpha.
Biden administration official Jesse Lee, a senior communications adviser to the National Economic Council, agreed with Zandi’s findings.AP Photo/Susan Walsh
“Inflation will probably fix itself over a ten year period, if we’re lucky,” Lucier told The Post, labeling the supposed “anti-inflationary effects” of the legislation as “smoke and mirrors.”
Rather than bringing down prices, some of the economists suggested that federal tax credits for Americans to buy electric vehicles and the extension of ObamaCare subsidies would exacerbate the problem.
“They’re giving people money to buy electric vehicles. They’re in short supply. The lithium that goes into them is in short supply. That’s gonna raise the price of electric vehicles,” said Morici, who added that “additional subsidies to buy health insurance is not going to lower the cost of health insurance, it’s going to increase the price.”
“Many of the incentives that are in the bill tend to increase the price of components for products that go into the electrical grid and so forth,” Morici continued. “So it’s basically giving people money to chase products that are in short supply.”
Will McBride, VP of federal tax and economic policy at the Tax Foundation, echoed that concern, saying the ObamaCare subsidies would make “entitlement spending” worse.
“Essentially,” McBride said, “the value of the dollar is getting diminished as the federal government’s ability to repay its debt diminishes.”
Additional reporting by Lydia Moynihan and Ariel Zilber.
Sen. Joe Manchin (DW.Va.) says he will talk to fellow centrist Sen. Kyrsten Sinema (D-Ariz.) about supporting a broad tax reform and climate bill he’s negotiated with Senate Majority Leader Charles Schumer (DN.Y.) that would reduce carbon emissions by 40 percent by 2030.
Sinema has kept silent about whether she will support the deal, which needs the votes of all 50 members of the Senate Democratic caucus to pass.
The Arizona senator expressed opposition last year to closing the carried interest tax loophole for asset managers, something that Manchin insisted be part of the deal.
Manchin said he didn’t keep Sinema in the loop during his talks with Schumer because he didn’t know if a deal was possible, but he said he plans to speak with her Monday afternoon, when the Senate is scheduled to vote on a judicial nominee to Virginia’s eastern district court.
“I’m sure we’ll get a chance to speak today because she usually comes in [on Monday]and we’ll speak on the floor,” he told reporters.
Manchin said last week that he was “adamant” about keeping a proposal to close the carried interest loophole, which lets money managers pay a capital gains tax rate on the income they earn from profitable investments.
Sinema’s staff said the senator is reviewing the legislation.
Manchin indicated that he would likely vote to protect the budget reconciliation package from amendments that would alter it significantly, arguing that he and Schumer have struck the right balance after months of difficult negotiations.
“I’m just saying, we have a good balanced piece of legislation. It’s taken me eight months to get here. We’ve listened to everybody along the way,” he said when asked whether he would vote for amendments to change the bill, which would raise $739 billion in new revenue and reduce the deficit by more than $300 billion.
Manchin said he kept his conversations with Schumer close to the vest.
“I haven’t had any conversations with anybody during the process because I wasn’t ever sure that we would get to a finale,” he acknowledged. “I never thought that could happen. I wasn’t sure.”
He said he “never quit” on the talks, but added that he “didn’t want to put people in the situation where their anticipations and hopes would go up and back down again.”
“It really unfolded last Monday, Tuesday, Wednesday,” he added.
Manchin pushed back at Republican claims that the bill would cause Americans across income brackets to pay slightly more in taxes.
An analysis by the Joint Committee on Taxation, for example, shows people earning between $50,000 and $75,000 would see their taxes increase by 0.8 percent in 2023.
Bloomberg reported Sunday the bill would increase a lapsed tax on crude and imported petroleum products to 16.4 cents per barrel.
“We have to agree to disagree. My Republican colleagues are my friends and I’ve worked with them tremendously and I’ll continue to work with them in any way, shape or form,” he said. “But these are things we have all talked about in bipartisan groups. How can we start paying down our debt and take our finances seriously?”
The energy and healthcare deal from Sens. Joe Manchin and Chuck Schumer would raise taxes on millions of Americans earning less than $400,000 annually, Senate Republican say, citing non-partisan data.
The Congressional Joint Committee on Taxation found that taxes would jump by $16.7 billion on American taxpayers making less than $200,000 in 2023 and raise another $14.1 billion on taxpayers who make between $200,000 and $500,000.
During the 10-year window, the average tax rate would go up for most income categories, the Senate GOP said, citing the data from the joint committee. And by 2031, new energy credits and subsidies would have people earning less than $400,000 pay as much as two-thirds of the additional tax revenue collected that year, the release said.
“Americans are already experiencing the consequences of Democrats’ reckless economic policies. The mislabeled ‘Inflation Reduction Act’ will do nothing to bring the economy out of stagnation and recession, but it will raise billions of dollars in taxes on Americans making less than $400,000,” said Sen. Mike Crapo, an Idaho Republican who sits on the Senate Finance Committee as a ranking member, and who requested the analysis.
“The more this bill is analyzed by impartial experts, the more we can see Democrats are trying to sell the American people a bill of goods,” Crapo added.
The Manchin-Schumer plan would spend $369 billion on energy and climate initiatives.AP/J. Scott Applewhite
But Democrats are objecting to the GOP’s assertions with a spokesperson for Senate Finance Chair Ron Wyden stating families “will not pay one penny in additional taxes under this bill,” according to Politico.
The spokesperson, Ashley Schapitl, also said the JCT analysis isn’t complete because “it doesn’t include the benefits to middle-class families of making health insurance premiums and prescription drugs more affordable. The same goes for clean energy incentives for families,” Politico reported.
The Manchin-Schumer plan would spend $369 billion on energy and climate initiatives and another $64 billion to continue federal health insurance subsidies.
Manchin believes the bill is “not putting a burden on any taxpayers whatsoever.”Reuters/Elizabeth Frantz
The measure would raise $739 billion over a ten-year span with much of that money coming from a 15% corporate minimum tax, the West Virginia Democrat and Senate Majority Leader from New York said.
Manchin, in touting the bill, said it “would dedicate hundreds of billions of dollars to deficit reduction by adopting a tax policy that protects small businesses and working-class Americans while ensuring that large corporations and the ultra-wealthy pay their fair share in taxes.” .”
He said on CNN Sunday the bill is “not putting a burden on any taxpayers whatsoever.”
On “Meet the Press” he said, “I agree with my Republican friends, we should not increase and we did not increase taxes.”
Sen. Joe Manchin in the US Capitol on Tuesday, June 14, 2022. Sen. Joe Manchin, DW.Va., and his staff told Democratic leadership on Thursday that he’s not willing to support better climate and tax provisions in a sweeping Biden agenda bill, according to a Democrat briefed on the conversations.
Tom-Williams | Cq-roll Call, Inc. | Getty Images
Senator Joe Manchin, DW.V., made the morning talk show rounds on Sunday to talk about the Inflation Reduction Act of 2022, a revival of President Joe Biden’s Build Back Better economic bill that collapsed earlier this year.
The inflation bill, which Democrats are attempting to pass through reconciliation, aims to reform the tax code, cut health-care costs and fight climate change. It will invest more than $400 billion over a decade by closing tax loopholes, mostly on the largest and richest American corporations. It would also reduce the deficit by $300 billion in the same decade-long timeframe.
“This is all about fighting inflation,” Manchin told Jonathan Karl on Sunday’s “This Week” on ABC.
Manchin insisted that the bill isn’t a spending bill, but instead is focusing on investing money.
“We’ve taken $3.5 trillion of spending down to $400 billion of investing without raising any taxes whatsoever, we closed some loopholes, didn’t raise any taxes,” he added.
He further explained the closing of tax loopholes, which will raise taxes on certain American companies. Any tax increase could jeopardize full Democratic support of the legislation, which it needs to pass through reconciliation – Senator Kyrsten Sinema, DA.Z., may not support this provision.
“The only thing we have done is basically say that every corporation of a billion dollars of value or greater in America should pay at least 15% of minimum corporate tax,” he said on NBC’s “Meet the Press.”
“That’s not a tax increase it’s closing a loophole,” he said.
Manchin also noted that a deal between Senate Majority Leader Chuck Schumer, D-NY, and he was struck in private to avoid drama.
“We’ve been negotiating off and on very quietly because I didn’t know if it would ever come to fruition,” he said. “I didn’t want to go through the drama that eight months ago we went through for so long.”
Manchin added that he’s struck an agreement with Democratic leaders to support the bill in exchange for taking on permitting reform later.
“If I don’t fulfill my commitment promise that I will vote and support this bill with all my heart, there are consequences, and there are consequences on both sides,” he said on “Meet the Press.”
Manchin also noted that the bill will especially target energy prices in the US by upping production and using clean energy effectively.
“Inflation is the greatest challenge we have in our country right now,” he said on CNN’s “State of the Union.” “If you want to get gasoline prices down, produce more and produce it in America.”
manchin dodges election talk
During his Sunday interviews, Manchin repeatedly evaded answering questions about who he supports in upcoming elections – the 2022 midterms and the 2024 presidential election.
“I’m not getting involved in any election right now,” he said on “State of the Union.”
He reiterated that he would work with anyone that voters elect and specifically wouldn’t answer if he wants Democrats to keep control of Congress come November.
“Whatever the voters choose,” he said on “Meet the Press.” “Whoever you send me that’s your representative and I respect them.”
When specifically asked if he’d support Biden in reelection, he focused on Biden’s current presidency.
“Whoever is my president, that’s my president, and Joe Biden is my president right now,” he said on “This Week.”
