Tax and Spend Bill Moves to the House

On Sunday, August 7, the Senate passed the tax and spend budget reconciliation bill. The House of Representatives is expected to vote on it on Friday, August 12.

Why it matters: Despite rebranding it the “Inflation Reduction Act,” the bill could increase inflation in the short term and would not reduce inflation over the long term.

• While many of the worst elements of prior versions of this bill were left on the cutting room floor, it would still impose significant new tax increases and unprecedented government price controls on medicine.
• This would deter investment, inhibit innovation, and undermine economic growth.

Be smart: These three provisions make the bill unworkable:

1. The Corporate Book Minimum Tax — Raising taxes on companies when they make certain investments, like 5G network expansion or new energy production. Discouraging investment will make America poorer and reduce economic growth.
2. A new excise tax on stock buybacks would distort the efficient movement of capital and diminish the value of Americans’ retirement savings.
3. Price controls on medicines would reduce private sector investment in new drugs.

What we’re doing:

• We sent Senators a Key Vote Letter opposing the tax and spend bill.
• We joined 253 state and local chambers and national trade associations in opposing the bill.
• We continue to engage paid media and our grassroots network to inform constituents and lawmakers in key Congressional districts.

Bottom line: This bill would mean more inflation and less innovation. The Chamber is using all our advocacy tools to urge House Members to reject it.

Story by the U.S. Chamber of Commerce