Senate passes the Inflation Reduction Act

Jacob Buhle, Staff Writer

August 7, the Senate passed the Inflation Reduction Act; It was passed into law August 16. The Act was passed to improve several parts of the economy such as creating more protections for working class families, a tighter tax code, creating a more green-energy car manufacturing industry, and making healthcare more affordable. 

In the Senate summary of the Inflation Reduction Act, it will protect working class families. It states that the Act will protect families and small businesses that make up to $400,000 and invest in communities by spending $60 billion for cleaning up pollution found within these communities. The Act also states that it is investing more than $60 billion in creating millions of domestic clean manufacturing jobs as a way of supporting both the working class families and the environment. The summary addresses more working class protections by enhancing IRS enforcement, placing a 1% fee on stock buybacks, and creating a 15% corporate minimum tax. In the official White House report it states that any family making less than $400,000 a year will see no changes to their taxes and instead it targets wealthier businesses and corporations by tightening the tax code. 

The Inflation Reduction Act includes protections for the environment and an official change to car manufacturing. According to the White House fact sheet, the Act will use tax incentives to target manufacturing towards U.S products that are clean energy, including batteries, solar power, offshore wind components, and carbon capture technologies. This includes a 10% increase of clean energy tax credits towards communities that have implemented clean energy projects. The Senate summary states that the goal is to reduce carbon emissions 40% by 2030.

The last major part of the Act is how it affects healthcare and its cost. The Senate states that healthcare benefits are expanded from this bill that include free vaccines in 2023, $35/month insulin and lowers out-of-pocket drugs to $4,000 in 2024 and officially lowers it to $2,000 by 2025. The Senate said that the Act will lower healthcare costs by saving an individual $800/year in the Health Insurance Marketplace. Medicare is allowed to negotiate 100 drugs over the next decade and drug companies are now required to rebate back price increases that were higher than inflation.