List of tax increases in the Democrat Reconciliation Bill – Americans for Tax Reform | Vette Leader

$6.5 billion natural gas tax that will increase household energy bills

The bill will impose a regressive tax on American oil and gas production. The tax will drive up household energy bills. The Congressional Budget Office estimates that the natural gas tax will increase taxes by $6.5 billion.

The tax hike goes against President Biden’s promise of taxes to every American earning less than $400,000 a year. Officials in the Biden administration have repeatedly admitted that taxes that increase consumer prices for energy violate President Biden’s $400,000 tax promise.

A letter to Congress from the American Gas Association warned that the methane tax would increase the average family’s natural gas bill by 17%. Democrats included a tax in the bill even as retail energy prices in the United States surpassed multi-year highs.

$12 billion crude oil tax Which will increase household expenses

With gas averaging more than $4.00 a gallon nationwide and just weeks away from record prices, Democrats have introduced a 16.4 cents per barrel tax on crude oil and imported petroleum products, in the form of to the Higher gas prices will be passed on to consumers.

The tax hike goes against President Biden’s promise of taxes to every American earning less than $400,000 a year.

As noted above, Biden administration officials have repeatedly admitted that taxes that increase consumer prices for energy violate President Biden’s $400,000 tax promise.

As if it weren’t bad enough, the Democrats have linked their oil tax hike to inflation. When inflation rises, so does the tax level.

The bipartisan Joint Committee on Taxation (JCT) estimates the provision will net $12 billion in taxes.

$1.2 billion coal tax that will increase household energy bills

The bill would more than double current excise taxes on coal extraction. Under the Democrats’ proposal, the tax rate on underground coal would increase from $0.50 per tonne to $1.10 per tonne, while the tax rate on open pit coal would increase from $0.25 per tonne to $0.55 per tonne ton would rise.

JCT estimates this will result in $1.2 billion in tax revenue, which will be passed on to consumers in the form of higher utility bills.

$225 billion Corporate tax increase passed on to households

Democrats have imposed an alternative minimum tax of 15 percent on the year-end earnings of American companies that have reported $1 billion in profits over the past three years. These American companies employ millions of Americans.

The cost of this tax increase will be borne by working families in the form of higher prices, fewer jobs and lower wages.

A report by the Tax Foundation last December found that a 15 percent book tax would reduce GDP by 0.1 percent and eliminate 27,000 jobs.

Preliminary cost estimates by the Congressional Budget Office indicated that the provision would increase taxes by more than $225 billion.

According to JCT’s analysis, 49.7 percent of the tax would be borne by the manufacturing industry at a time when manufacturers are already grappling with supply chain disruptions.

The tax foundation also warned that current supply chain problems could be exacerbated by the disproportionate burden of the book tax on key industries. The report concluded that “the coal industry is the most heavily burdened by the book minimum tax, with a net tax increase of 7.2 percent of its pre-tax book income, followed by car and truck manufacturing, which faces a 5.1 percent tax increase .”

$74 billion Stock tax that will hit your nest egg – 401(k)s, IRAs and retirement plans

If Americans choose to sell back stock to a company, Democrats will impose a new state consumption tax that will devalue the household nest egg. Tax increases and restrictions on stock buybacks hurt the retirement savings of anyone with a 401(k), IRA, or retirement plan.

Union pension plans will also be affected.

The tax puts US employers at a competitive disadvantage compared to China, which has no such tax.

Stock buybacks help grow retirement accounts. Tax increases and buyback restrictions would hurt the 58 percent of Americans who own stocks and more than 60 million workers who have invested in a 401(k). Another 14.83 million Americans are invested in 529 educational savings accounts.

Retirement accounts hold the largest portion of corporate stock, accounting for about 37 percent of the $22.8 trillion of outstanding US corporate stock, according to the Tax Foundation.

In 2017, corporate sponsored funds represented a market value of $4.45 trillion; union-funded funds accounted for $409 billion; and publicly funded funds benefiting teachers and police officers totaled $4.25 trillion.

When companies buy back shares, these investors benefit. A tax on buybacks could discourage companies from taking this action and negatively impact retirement savings.

95% federal excise tax for American pharmaceutical manufacturers

Democrats would impose a 95 percent excise tax on prescription drugs unless drugmakers accept government price controls.

In reality, all drugmakers would accept the price controls or stop selling the drug in the US market altogether, rather than pay the 95 percent tax.

This provision would limit medical innovation in the US and limit the supply of new drugs.

Price controls never work because they cause supply bottlenecks. CBO warned that the drop in manufacturers’ revenue could be as high as $1 trillion over the next decade and would “reduce R&D spending, thereby reducing new drug launches.”

The CBO also emphasizes the “uncertainty” in estimating the number of new drugs that would be prevented from entering the market. The agency has already revised its original estimate to increase the number of drugs prevented by 50 percent.

$52 billion Income tax increase for medium-sized and family businesses

Just as the US economy slips into recession, Democrats propose a tax hike for transit companies with declared losses. This provision expands the net taxable income. Preliminary cost estimates by the Joint Committee on Taxation show the provision will increase taxes by $52 billion.

Senate Democrats passed an amendment to the bill before final passage that would provide a two-year extension to non-corporate taxpayers’ loss limits if the amount of losses exceeds $250,000 ($500,000 in the case of a joint return). This provision was due to expire in 2026 under current law.

This provision would increase taxes for a manufacturer, retailer, or other capital-intensive business that incurs significant business losses each year due to the cost of wages, rent, new equipment, inventory, and interest payments.

The loss limit was originally created by the Republican Tax Reduction and Employment Act passed in Congress, but was used to offset the introduction of the 20 percent deduction for passthrough corporations, resulting in a net tax reduction for those corporations. Senate Democrats have now extended that loss cap for another two years to pay for their reckless taxes and spending. she Not Extension of the 20 percent deduction for transit companies.

This provision goes against President Biden’s campaign promise to small businesses: “Small business taxes will not go up.”

IRS oversized to increase audits – $204 billion

The bill would spend $80 billion to expand the IRS with 87,000 new agents and auditors and to step up audits of working households and small businesses. The IRS would conduct an additional 1.2 million annual audits under the plan. Democrats claim the increased enforcement spending would bring in $124 billion.

The bill spends 14 times as much money on “enforcement” – such as small business audits – than on “taxpayer services” – such as answering phone calls. IRS employees only answer the phone “19 or 20 percent” of the time.

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