Brewing battle over tax hikes to test Democratic unity
An emerging proposal from the White House and Senate Democratic leaders to pay for President Biden’s infrastructure agenda is setting the stage for a major battle in Congress that will test the support of moderates concerned about hiking taxes.
Key centrists such as Sens. Joe Manchin (D-W.Va.), Kyrsten Sinema (D-Ariz.), Jon Tester (D-Mont.), Maggie Hassan (D-N.H.) and Mark Kelly (D-Ariz.) have largely avoided questions about Biden’s tax agenda, which is focused on raising hundreds of billions of dollars from corporations and wealthy Americans.
To date, much of the debate in Congress has focused on how to pay for a scaled-down $1.2 trillion bipartisan infrastructure package and the contours of a more expensive measure that Senate Majority Leader Charles Schumer (D-N.Y.) plans to pass under a budget reconciliation process allowing Democrats to sidestep a GOP filibuster.
But the brewing battle over tax policy is starting to heat up as lawmakers return to Washington for a crucial work period when Democrats will begin hashing out the budget resolution that sets in motion the legislative vehicle Democrats intend to use to pass some of the party’s biggest priorities, without any GOP support.
Schumer and Democrats on the Senate Budget Committee have discussed a $6 trillion reconciliation package that would include $2.4 trillion in tax increases and legislation to lower the price of prescription drugs that would save the federal government an estimated $600 billion over 10 years.
“They’re all trying to figure out what the bottom line is,” said a person familiar with the internal negotiations. “Schumer had $2.4 trillion [in tax revenues] plus $600 billion from the Medicare drug-price negotiation. He’s trying to figure out: ‘What can I get my caucus to support? What’s the revenue number?’ It’s not clear to me he can get $3 trillion."