List of Tax Hikes in Democrat Reconciliation Bill

[Ubiquitous]

$6.5 Billion Natural Gas Tax Which Will Increase Household Energy Bills

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

The tax hike violates President Biden’s tax pledge to any American making
less than $400,000 per year. Biden administration officials have repeatedly
admitted taxes that raise consumer energy prices are in violation of
President Biden’s $400,000 tax pledge.

A letter to Congress from the American Gas Association warned that the
methane tax would amount to a 17% increase on an average family’s natural gas
bill. Democrats have included a tax in the bill despite retail prices for
energy surpassing multi-year highs in the United States.

$12 Billion Crude Oil Tax Which Will Increase Household Costs

With gas averaging more than $4.00 per gallon across the country and only
weeks removed from record-high prices, Democrats have included a 16.4 cents-
per-barrel tax on crude oil and imported petroleum products that will be
passed on to consumers in the form of higher gas prices.

The tax hike violates President Biden’s tax pledge to any American making
less than $400,000 per year.

As noted above, Biden administration officials have repeatedly admitted taxes
that raise consumer energy prices are in violation of President Biden’s
$400,000 tax pledge.

As if it weren’t bad enough, Democrats have pegged their oil tax increase to
inflation. As inflation increases, so will the level of tax.

The non-partisan Joint Committee on Taxation (JCT) estimates the provision
will raise $12 billion in taxes.

$1.2 Billion Coal Tax Which Will Increase Household Energy Bills

The bill would more than double current excise taxes on coal production.
Under the Democrat proposal, the tax rate on coal from subsurface mining
would increase from $0.50 per ton to $1.10 per ton while the tax rate on coal
from surface mining would increase from $0.25 per ton to $0.55 per ton.

JCT estimates that this will raise $1.2 billion in taxes that will be passed
on to consumers in the form of higher electricity bills.

Corporate Income Tax Hike on U.S. Businesses Which Will Be Passed on to
Households

Democrats imposed a 15 percent corporate alternative minimum tax on the
financial statement income of American businesses reporting $1 billion in
profits for 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 Tax Foundation report from last December found a 15 percent book tax would
reduce GDP by 0.1 percent and kill 27,000 jobs.

The most recent cost estimate from the Congressional Budget Office found the
provision would increase taxes by more than $313 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 struggling
with supply-chain disruptions.

Tax Foundation also warned that current supply chain issues could be worsened
by the book tax’s disproportionate burden on key industries. The report
concluded that “the coal industry faces the heaviest burden of the book
minimum tax, facing a net tax hike of 7.2 percent of its pretax book income,
followed by automobile and truck manufacturing, which faces a 5.1 percent tax
hike.”

$124 Billion Stock Tax Which Will Hit Your Nest Egg — 401(k)s, IRAs and
Pension Plans

When Americans choose to sell shares of stock back to a company, Democrats
will impose a new federal excise tax which will reduce the value of household
nest eggs. Raising taxes and restricting stock buybacks harms the retirement
savings of any individual with a 401(k), IRA or pension plan.

Union retirement plans will also be hit.

The tax will put U.S. employers at a competitive disadvantage with China,
which does not have such a tax.

Stock buybacks help grow retirement accounts. Raising taxes and restricting
buybacks would harm the 58 percent of Americans who own stock and more than
60 million workers invested in a 401(k). An additional 14.83 million
Americans are invested in 529 education savings accounts.

Retirement accounts hold the largest share of corporate stocks, accounting
for roughly 37 percent of the outstanding $22.8 trillion in U.S. corporate
stock, according to the Tax Foundation.

In 2017, corporate-sponsored funds made up $4.45 trillion in market value;
union-sponsored funds accounted for $409 billion; and public-sponsored funds,
which benefit teachers and police officers, added up to $4.25 trillion.

When companies perform stock buybacks, these investors are the ones who
benefit. A tax on buybacks could dissuade companies from conducting this
action and negatively impact retirement savings.

95% Federal Excise Tax on American Pharmaceutical Manufacturers

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

In reality, all drug manufacturers would accept the price controls or stop
selling the drug in the U.S. market entirely rather than pay the 95 percent
tax.

This provision would restrict U.S. medical innovation and limit the supply of
new medicines.

Price controls never work because they cause supply shortages. CBO warned the
reduction in manufacturers’ revenue could be as high as $1 trillion over the
next ten years and would “lower spending on research and development and thus
reduce the introduction of new drugs.”

The CBO further stresses the “uncertainty” in assessing the number of new
medicines that would be prevented from coming to market. The agency already
revised its original assessment to increase the number of drugs prevented
from being introduced by 50 percent.

$52 Billion Income Tax Hike on Mid-Sized & Family Businesses

Just as the U.S. economy slides into a recession, Democrats are including a
tax hike on passthrough businesses with declared losses. This provision
widens the net of taxable income. Preliminary cost estimates from 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
created a two-year extension on loss limitations of noncorporate taxpayers if
the amount of the loss is in excess of $250,000 ($500,000 in the case of a
joint return). This provision was scheduled to sunset in 2026 under current
law.

This provision would raise taxes on a manufacturer, retailer or other
capital-intensive business that sees significant business losses in any year
due to the cost of wages, rent, new equipment, inventory, and interest
payments.

The loss limitation was originally created by the Tax Cuts and Jobs Act
passed by Congressional Republicans but was used to offset the creation of
the 20 percent deduction for passthrough businesses, resulting in a net tax
cut for these businesses. Senate Democrats have now extended this loss
limitation for two additional years to pay for their reckless tax and spend
spree. They did not extend the 20 percent deduction for passthrough
businesses.

This provision violates President Biden’s campaign pledge to small
businesses: “Taxes on small businesses won’t go up.”

Supersizing the IRS to Increase Audits – $124 Billion

The bill would spend $80 billion to supersize IRS with 87,000 new agents and
auditors and ramp up audits on working households and small businesses. The
IRS would perform an additional 1.2 million annual audits under the plan.
Democrats claim the increased spending on enforcement would net $124 billion.

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

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Let's go Brandon!