Democrats said they finally reached an agreement with U.S. Sen. and centrist Democrat Kyrsten Sinema on a major $430 billion climate and spending bill after facing multiple objections to the critical legislation.
Sinema confirmed that she has agreed to “move forward” with the bill, which covers drug pricing, energy, environment, health and tax measures, provided the Senate lawmaker gave her party the go-ahead to pass it through a budget vote, which Democrats intend to do despite objections from the Republican camp.
However, Democrats were only able to strike the deal with Sinema after they removed a provision that closes what’s known as the carry rate loophole, which allows partners in private investment funds to have their income taxed as capital gains, at a lower rate than income, according to to the Tax Policy Centre.
The chamber will convene on Saturday to vote on a proposal, paving the way for debate on the bill in the House, Senate Majority Leader Chuck Schumer said Thursday.
The bill, known as the Inflation Reduction Act, is a key domestic policy piece of legislation for the Biden administration and Democrats ahead of the upcoming November election campaign for the leadership of the US Congress.
But the bill needed Sinema’s nod to break through, as Democrats could not risk losing the support of a single lawmaker.
The Arizona senator had been the only one yet to give her endorsement when West Virginia’s Joe Manchin struck a deal with top Democrats last week announcing his vote for the bill as “great for America.” He effectively gutted an earlier version of the law last year.
Another concern for Democrats is Covid-19. Senators can only vote in person, making it mandatory for Mr. Schumer’s full caucus to be present and healthy to pass the bill.
Schumer said he believes he now has the votes.
“The deal preserves key components of the Inflation Reduction Act, including reducing prescription drug costs, fighting climate change, closing tax loopholes exploited by big corporations and the wealthy, and reducing the deficit by $300 billion,” he said.
Likely to be presented in the House by the Democrats for adoption next week, the bill and its content must be approved by the parliamentarian who will allow it to move forward through the process of “reconciliation”.
By doing this, Democrats can bypass the standard rule of needing 60 senators to pass most legislation.
President Joe Biden has hailed the bill as a crucial step to help people save money on prescription drugs and health care premiums.
“It will make our tax system fairer by making companies pay a minimum tax,” he said Thursday.
Additional reporting by agencies