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EXCLUSIVE: The White House is on offense this week as it tries to garner support for the more than $700 billion reconciliation package that Biden administration officials and Democrats say will lower the deficit, while slamming congressional Republicans for trying to “obstruct” the “anti-inflation plan” in order to protect “tax welfare” for corporations and the wealthy.
President Biden, last week, said the Inflation Reduction Act is “the strongest bill you can pass to lower inflation, cut the deficit, reduce health care costs, tackle the climate crisis, and promote energy security, all the time while reducing the borders facing working-class and middle-class families.”
The bill, according to the president and to congressional Democrats, will “reduce inflationary pressure on the economy” and will “restore fairness to the tax code” by making the largest corporations “pay their fair share.”
But the White House this week is taking preemptive strikes at Republicans, saying the GOP won’t work with them to fight inflation.
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President Biden speaks about inflation and supply chain issues in Los Angeles.
(AP Photo/Damian Dovarganes)
“Congressional Republicans like Rick Scott have proposed raising taxes on nearly 100 million working Americans, ending Medicare in 5 years, and compounding Donald Trump’s 2017 tax cuts for the wealthy with even more giveaways for the richest Americans,” White House deputy press secretary Andrew Bates told Fox News Digital.
“The president and congressional Democrats are pursuing the opposite with the Inflation Reduction Act — a plan for the middle class that 126 top economists confirm will ‘fight inflation and lower costs for American families,’ paid for with revenue ‘exclusively from wealthy individuals and corporations,’” Bates said.
“Instead of working with us against inflation, the congressional GOP has decided that tax welfare for hedge fund managers who pay less than the vast majority of Americans, for multibillion dollar corporations who game the system to pay nothing in taxes, and for Big Pharma matter more,” Bates told Fox News.
He added: “Congressional Republicans are trying to obstruct an anti-inflation plan in order to protect tax welfare for giant corporations and the wealthy.”
But Bates said it is “not a shock that those who call inflation a ‘political goldmine’ have their priorities so backwards.”
A White House official told Fox News that Republicans have a “simple choice,” which is to either back a plan that would “fight inflation and cut costs for families,” or support “tax welfare for big corporations and wealthy individuals who have rigged the tax code to their benefit, at the expense of everyone else.”
The reconciliation package raises revenue by requiring corporations with more than $1 billion in profits to pay at least a 15% tax rate and by enforcing the law so that corporations and high-income individuals pay the taxes they owe. The bill also closes the “carried interest” loophole for investment fund managers with at least $400,000 in income, which a White House official said enables them to pay a significantly lower tax rate than middle class families.
The bill spearheaded by Manchin and Schumer, according to the president and to congressional Democrats, will “reduce inflationary pressure on the economy” and will “restore fairness to the tax code” by making the largest corporations “pay their fair share.”
(F. Carter Smith/Kent Nishimura)
The White House estimates the 15% corporate tax rate will raise $313 billion over the next decade. A nonpartisan congressional panel, the Joint Committee on Taxation, estimates that nearly 50% of the total will come from American manufacturers.
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The National Association of Manufacturers estimates the 15% minimum corporate tax could lead to fewer blue-collar manufacturing jobs over the next decade. That reality stems from the fact that the tax will apply to corporations that list at least $1 billion in profits over a three-year period on their financial statements.
One tax in the bill specifically hits the energy industry. Called a “Waste Emissions Charge,” this provision would bill energy facility operators for methane emissions that escape into the atmosphere.
Senate Minority Leader Mitch McConnell, a Republican from Kentucky, walks to the Senate floor at the U.S. Capitol in Washington, on Tuesday, Jan. 18, 2022. Photographer: Eric Lee/Bloomberg via Getty Images
(Eric Lee/Bloomberg via Getty Images)
The American Natural Gas Association estimated that the tax would increase Americans’ natural gas bills by 17%. It would also apply to petroleum production, fossil fuel processing, energy storage and more.
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“Natural gas is the single largest source of electricity generation in our entire country,” Senate Minority Leader Mitch McConnell, R-Ky., said Monday. “A plurality of all the power in America comes from natural gas. It’s also how countless families heat their homes. And it’s a lynchpin of our domestic energy independence and our ability to export to allies like Europe. But the Green New Deal Democrats are coming straight after American natural gas with huge new tax hikes.”
“It’s a very simple message: Democrats are getting ready to vote for tax hikes during a recession,” a GOP aide told Fox News. “The sharks are already circling underneath the plank they will walk off.”
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The U.S. economy shrank in the spring for the second consecutive quarter, meeting the criteria for a recession as record-high inflation and higher interest rates forced consumers and businesses to pull back on spending.
Democrats are using a process called budget reconciliation to advance the legislation, which allows them to get around the Senate filibuster with just 50 votes. As long as all Democrats avoid catching COVID-19 and are present and able to vote for the bill, they likely have the votes to get the legislation across the finish line.
Fox News’ Haris Alic and Tyler Olson contributed to this report.
