Taxes

House, Senate Dems Reach Agreement On Taxes

SK Ashby
Written by SK Ashby

Speaker of the House Nancy Pelosi and Senate Majority Leader Chuck Schumer did not unveil an exact dollar amount that will be raised through new or higher taxes to pay for a reconciliation spending bill, but they did announce this morning that they've reconciled differences between House and Senate proposals.

"The White House, the House and the Senate have reached agreement on a framework that will pay for any final negotiated agreement. So the revenue side of this, we have an agreement on," Senate Majority Leader Chuck Schumer said at a press conference.

"We are writing legislation, and when you’re writing legislation, you have to be specific. And this took us a long way to a framework," House of Representatives Speaker Nancy Pelosi said.

The House Ways and Means Committee recently voted to approved taxes that would raise $2.9 trillion in revenue over 10 years; less than the $3.5 trillion cost enabled by the budget resolution serving as a vehicle for reconciliation. But we can say with some level of confidence that the final bill will not be as large as $3.5 trillion.

With centrist or moderate Democrats saying the price is too high, and with revenue likely falling below that level, it's unlikely that the final total will match President Biden's original proposal.

In my opinion, however, that's fine. It's not ideal, but politics in Washington almost never are. If Senators Joe Manchin and Kyrsten Sinema say they won't vote for anything more than $2 trillion or $1 trillion, even that would still be worth passing on its own merits.

It's my hope that more liberal Democrats will not refuse to vote for something smaller just because it's not as big as they wanted. The perfect should not be the enemy of the good.