October 4, 2022
White House signalling possible shift in plan for tax hikes on wealthy corporations as Sinema remains firm
WASHINGTON — Democrats are again grappling with how to pay for their multitrillion-dollar social safety net bill as Sen. Kyrsten Sinema, D-Ariz., remains opposed to raising taxes on the wealthy and corporations, three Democratic aides familiar with her position said.The tax increases have been central to Democrats’ plan to pay for the legislation at the…

WASHINGTON – Democrats are once again struggling to pay for their multitrillion dollar social safety net bill. Three Democratic aides said that Sen. Kyrsten Sinema , D. Arizona, is opposed to increasing taxes on corporations and the wealthy.

The tax increases are central to Democrats’ plan for paying for legislation that is at the core of President Joe Biden’s “Build back Better” agenda. This subject has been intense negotiations ..

But on Wednesday’s conference call, House Speaker Nancy Pelosi (D-Calif.) and Senate Majority Lead Chuck Schumer (D-N.Y.), Biden administration officials suggested that the plans might need to change, according to a source.

Details from the meeting were first reported The Wall Street Journal , and The Washington Post ..

Administration officials and Democratic leaders continued to talk how to pay for multitrillion-dollar legislation. These discussions included alternatives to raising the highest income tax bracket or increasing the corporate tax rate. Two people who were present at the conference call said that they knew.

Included Schumer and Pelosi were Ron Wyden (D-Ore.) and Richard Neal (D-Mass.), Chairman of the Senate Finance Committee. White House deputy press secretary Andrew Bates stated Wednesday evening in a statement that Biden’s plan would receive full funding.

“The President is working to pass game-changing investments in economic growth that benefits the middle class, paid for by having the richest taxpayers and big corporations pay their fair share and without raising taxes on any American making less than $400,000,” he said. This legislation has a price tag of 0. There is an expansive menu of options for how to finance the President’s plan to ensure our economy delivers for hardworking families, and none of them are off the table.”

The changes are intended to accommodate Sinema’s long-expressed opposition to the tax increases, said a person familiar with her thinking.

” There has been no change in Sinema’s position for some time,” said a person who was privy to negotiations. She also stated that Sinema doesn’t support any increase in carried interest in either the individual or corporate tax rates. “It’s coming down to the wire,” a source said. “We need to think about what we can do to move forward without tax increases.”

Nothing has been decided, a source cautioned.

Sen. Joe Manchin, D-W.Va., who has forced Democrats to lower their price tag of the overall bill, wrote in a memo to Schumer that he supports increasing the individual tax rate to 39.6 percent and the corporate rate to 25 percent. Biden wanted to lift the corporate rate to 28 percent. In separate meetings with House progressives as well as moderates, Biden started to refocus policy provisions and determine what would be cut, including a tuition-free community college.

A plan for resolving the revenue loss from Sinema’s demands involves a number of other options, including a tax on billionaires and a new minimum corporate tax, according to a person who was familiar with the details. Another person stated that the discussions include increased IRS enforcement in order to increase revenue.

Asked for comment about her stance on tax policy in the package, a spokesperson for Sinema said, “We aren’t confirming any of this but as always will let you know if that changes.”

Sinema has been in constant conversation with the White House about the legislation. She might not be alone. A senior aide to a moderate House Democrat said some lawmakers are “grateful that Sinema is stepping up to roll back some of these politically unpopular revenue raisers.”

Leigh Ann Caldwell

Leigh Ann Caldwell is an NBC News correspondent.

MSNBC Anchors - Season 15Kristen Welker

Kristen Welker is chief White House correspondent for NBC News.

Image: Frank ThorpFrank Thorp V

Frank Thorp V is a producer and off-air reporter covering Congress for NBC News, managing coverage of the Senate.

Image: Julie TsirkinJulie Tsirkin

Julie Tsirkin is a producer and reporter for NBC News’ Capitol Hill team.

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