WASHINGTON – House Speaker Nancy Pelosi told colleagues on Wednesday Democrats were “in pretty good shape” on President Joe Biden’s broad national plan and on a $ 1 trillion infrastructure bill. dollars as they rushed to wrap up talks ahead of his departure for world summits.
His upbeat comments came as Biden and Democrats try to close a deal soon on his grand proposal, now about $ 1.75 trillion in social services and climate change programs, in part to show leaders foreigners as the United States get things done under his new administration.
White House officials were meeting on Capitol Hill with two key Democrats, Senator Joe Manchin of West Virginia and Kyrsten Sinema of Arizona.
But Manchin held back, sweeping aside Democrats’ proposed new tax on billionaires, saying he didn’t like the idea of ”targeting” the rich. Still, he said it was time to move forward on a framework for Biden’s plan.
“The people in the stratosphere, rather than trying to penalize, we should rejoice that this country is able to produce wealth,” Manchin told reporters ahead of the meeting.
Manchin has said he prefers a flat-rate “patriotic tax” of at least 15% to ensure that the richest Americans do not pay taxes. “There is a patriotic duty that you should pay something to this great country,” he said.
Nonetheless, he said: “We have to move forward – the President has made it very clear – he wants to move forward and we owe the President to move forward.”
The acceleration in the pace of negotiations came as Senate Democrats fended off skeptics on Wednesday and unveiled a new billionaires’ tax proposal, designed to help pay the price and move his party closer to a comprehensive deal.
There is a Sunday deadline to approve the smaller, bipartisan highway and bridge infrastructure bill or risk allowing funds for routine transportation programs to expire. But this $ 1,000 billion bill has been blocked by progressive lawmakers who refuse to give their support without the biggest Biden deal.
Pelosi told colleagues she would communicate later today on the developments, according to another person who requested anonymity to discuss the speaker’s private remarks at a meeting of House Democrats.
“It will determine our schedule, our course of action but we are in pretty good shape,” she said.
Senate Majority Leader Chuck Schumer sounded a similar deal when he opened the room.
“An agreement is at arm’s length,” said Schumer, DN.Y. “We hope to be able to reach a framework agreement by the end of today.”
Pelosi reiterated that for the House to pass the bipartisan infrastructure bill, Democrats must have “confidence, trust and reality” in Biden’s larger package.
Part of that plan is now being focused: The unveiling of the billionaire tax on Wednesday could help solve the revenue side of the equation as Democrats try to agree on a tax strategy.
The proposed new tax would hit the earnings of those with more than $ 1 billion in assets or income of more than $ 100 million a year, and it could begin to bolster the grand scheme of social and anti-social services. climate change.
The new billionaires’ proposal, paired with a new 15% minimum corporate tax, would provide alternative sources of income Biden needs to convince Sinema, who had rejected the party’s earlier idea of canceling tax breaks from the the Trump era on corporations and the wealthy to raise. returned.
Biden met Sinema and Manchin at the White House on Tuesday evening.
The three have made progress on the plans, a White House official said.
“No senator wants to stand up and say, ‘I think it’s great that billionaires pay little or no tax for years,’ ‘said Democratic Senator Ron Wyden of Oregon, chairman of the Senate Finance Committee, leading the new effort.
Biden and his party are focused on at least $ 1.75 trillion in health care, child care and climate change programs, slashing what was a $ 3.5 trillion plan, while they are trying to conclude negotiations this week.
Together, the new billionaire tax and the 15% corporate minimum tax are designed to meet Biden’s desire that the rich and big corporations pay their “fair share.” They also match his promise that no new taxes hit those who earn less than $ 400,000 a year, or $ 450,000 for couples. Biden wants his package paid for in full without going into debt.
While the new tax proposals have seemed pleasant to Manchin and could win over Sinema, whose support is needed in the 50-50 split Senate where Biden has no voice to spare, the idea of the billionaire tax has been criticized by other Democrats like bulky or worse.
Representative Richard Neal, D-Mass., Chairman of the Ways and Means Committee, said he told Wyden the billionaire tax may be more difficult to implement than the route his panel took to simply increase corporate and wealthy rates.
As part of Wyden’s emerging plan, the billionaire tax would hit the wealthiest Americans, less than 800 people, starting in tax year 2022.
This would force those with assets of more than $ 1 billion, or three consecutive years of income of $ 100 million, to pay taxes on earnings from stocks and other marketable assets, rather than waiting for the holdings. be sold.
A similar tax for billionaires would be applied to non-marketable assets, including real estate, but it would be deferred with unassessed tax until the asset is sold, although interest would have to be paid.
Overall, the billionaire tax rate would align with the capital gains rate, now 23.8%. Democrats have said it could generate $ 200 billion in revenue that could help fund Biden’s 10-year program.
“I’ve been talking about this for years,” said Senator Elizabeth Warren, D-Mass., Who campaigned for the presidency on a wealth tax, and supports Wyden’s approach. “I even made billionaires cry about it.”
Republicans scoffed at the billionaire tax as “insane,” and some suggested it would face a legal challenge.
And senior Democratic colleagues have also raised concerns about the billionaire tax, saying the idea of simply undoing the 2017 tax cuts by raising the highest rates was more straightforward and transparent.
Under the House bill approved by Neal’s panel, the top tax rate would drop from 37% to 39.6% for those earning more than $ 400,000 per year, or $ 450,000 for couples. The corporate rate would drop from 21% to 26.5%. The bill also proposes a 3% surtax on the richest Americans with adjusted income in excess of $ 5 million per year.
With Sinema rejecting the House’s approach to taxes and Manchin planning the new spending on programs, the senators threw a punch, upsetting Biden’s overall plan.
It also required difficult cuts, if not outright elimination, of policy priorities – from paid family leave and childcare to dental, vision and hearing benefits for the elderly.
Once cumbersome climate change strategies are also losing weight, shifting away from punitive measures against polluters who have raised objections from the Manchin coal state, in favor of incentives to reward clean energy .
Manchin’s resistance could derail another tax idea – a plan to give the IRS more resources to prosecute tax evaders. He said he told Biden at their weekend meeting at the president’s home in Delaware that the plan was “angry” and would allow the government to monitor bank accounts.
Associated Press editors Farnoush Amiri, Darlene Superville, and Colleen Long contributed to this report.
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