Democrats in the Senate voted along party lines on Sunday to pass the so-called “Inflation Reduction Act.”
The bill was brought to a vote after an all-night floor session that began at around 11:30 p.m. ET Saturday night in a process known as a “vote-a-rama.” Debates on amendments lasted all night and into Sunday afternoon, when the bill was put up for a final vote at around 3:00 p.m. ET on Sunday. All 50 Democrats voted for the bill, while all 50 Republicans voted against it. Vice President Kamala Harris broke the tie vote.
The $740 billion legislation now heads to the House of Representatives, which is set to reconvene at the end of this week to vote on it, The Hill reports.
The largest portion of the bill is a $369 billion climate spending package. An analysis conducted by Majority Leader Chuck Schumer’s office claims the spending will cut carbon emissions by 40% by 2030. The plan includes tax credits of $4,000 and $7,500 to buy used and new electric vehicles, but does not allow the credits to be used on vehicles that have batteries with materials processed in China. The bill also contains a 16.4 cents per barrel tax on crude oil and petroleum products imported into the U.S.
The bill also includes a number of Democratic health care priorities. The bill purports to lower the cost of prescription drugs for senior citizens by allowing Medicare to negotiate the prices of drugs administered by a doctor’s office or pharmacy. According to CNN, the bill allows the Secretary of Health and Human Services to negotiate prices for 10 drugs beginning in 2026, 15 drugs in 2027 in 2028, and 20 drugs per year from 2029 onward. The bill also extends Obamacare premium subsidies through 2025, a year later than originally discussed.
In terms of new taxes, the bill proposes to raise some $258 billion in new revenue by imposing a 15% minimum tax on companies with more than $1 billion in profits and force companies to follow “generally accepted accounting principles when reporting income to the IRS,” The Hill reports. The bill also imposes a 1% excise tax on stock buybacks, which is estimated to take in some $74 billion in new taxes.
According to a report from Politico, more than 20 amendments to the bill were proposed by Senators on both sides of the aisle, but the Senate struck down nearly all of them, voting as a bloc, even on provisions they supported, to get the bill over the finish line.
Republicans forced votes on several last-minute amendments on Sunday. First, they successfully cut out a portion of the bill that placed a $35 cap on insulin prices in the private insurance market.
Then, House Minority Whip John Thune (R-SD) introduced an amendment to create exemptions for the 15% corporate minimum tax established by the bill.
According to Politico, the amendment exempted businesses owned by private equity, and paid for the lost revenue by extending the cap on State and Local Tax deductions for one year. It was supported by Sen. Kyrsten Sinema (D-AZ), but caused a stir because it would cause electoral problems for House Democrats in coastal districts who campaigned on ending the SALT cap. Senator Mark Warner (D-VA) replaced the SALT cap extension with an amendment to extend existing limitations on how certain businesses can write off their losses for another two years, Politico reported.
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