Senate Majority Leader Chuck Schumer (D-NY) and Sen. Joe Manchin (D-WV) announced on Wednesday that they have struck a deal on a reconciliation package that would aim to combat climate change, extend Obamacare subsidies, and lower the deficit.
Schumer and Manchin struck a deal on a reconciliation package, the Inflation Reduction Act of 2022, that would, in their eyes, “address record inflation by paying down our national debt, lowering energy costs and lowering healthcare costs.”
The two Democrats said that the bill would lower deficits by $300 billion over ten years, spend $369.8 billion on climate change programs, and extend enhanced Affordable Care Act (ACA) subsidies for three years.
The measures would also include a provision to allow Medicare to negotiate the price of drugs, which would save money for the climate change and Obamacare portions of the bill. Allowing Medicare to negotiate the price of drugs would reportedly save $288 billion. The legislation would also “close tax loopholes on wealthy individuals and corporations.”
Indeed, the legislation would have a 15 percent minimum corporate tax that is estimated to raise $313 billion. The legislation would also raise $124 billion from enhanced tax enforcement by the IRS.
Sen. Ron Wyden (D-OR) floated increasing IRS audits to pay for the enhanced Obamacare subsidies contained in a potential reconciliation package. The enhanced Obamacare subsidies, first created under President Joe Biden’s $1.9 trillion American Rescue Plan, or his coronavirus aid bill, would expire this year.