Build Back Cheaper
Biden, Democrats exploring new tax options after Sinema reportedly blocks rate hikes on corporations, the wealthy
President Biden held a private call with top congressional Democrats and Treasury Secretary Janet Yellen late Wednesday to discuss alternate ways of paying for the roughly $1.9 trillion Build Back Better package that appears to be taking shape in Washington, The Washington Post reports. The scramble for new revenue sources is due, to some large extent, by staunch opposition from Sen. Kyrsten Sinema (D-Ariz.) to the proposed increases in tax rates on corporations, capital gains, and individuals earning more than $400,000 a year, according to reports in The Wall Street Journal, The Associated Press, The New York Times, and the Post.
Sinema "has previously told lobbyists that she is opposed to any increase in those rates," the Journal reports. Unlike fellow centrist holdout, Sen. Joe Manchin (D-W.Va.), Sinema has not publicly discussed what she wants for her support or why. Manchin, unlike Sinema, publicly supports unwinding the GOP's 2017 tax cuts for corporations and high earners, but he also, unlike Sinema, is insisting the Build Back Better package be budget-neutral. Democrats need all 50 of their senators to pass the bill.
Democrats have "an expansive menu of options for how to finance the president's plan," White House spokesman Andrew Bates said, "and none of them are off the table."
Senate Finance Committee Chairman Ron Wyden (D-Ore.) — who was on the call along with his House counterpart, Rep. Richard Neal (D-Mass.) — said he "stressed the importance of putting an end to America's two tax codes, and finally showing working people in this country that the wealthiest Americans are going to pay taxes just like they do." Neal said he hopes to meet with Sinema soon and "talk some of this through."
The White House believes Sinema is open to "a range of other revenue raisers," including "increased IRS efforts to collect taxes owed by corporations and high earners, and increased taxes on the income that multinational companies operating in the United States earn overseas," the Times reports. Biden is also exploring a 15 percent corporate minimum tax and a Wyden proposal for a modified billionaire tax.
"There's a lot they can do to raise taxes without the rate hikes, but eliminating the rate hikes on corporations makes it a lot harder," Howard Gleckman, a policy expert at the nonpartisan Tax Policy Center, tells the Post. "But you can do it, especially if the goal is a lot smaller."