Centrist Sen. Kyrsten Sinema (D-Arizona) has been a question mark ever since Sen. Joe Manchin(D-West Virginia) agreed to a scaled-down version of President Joe Biden‘s social spending bill after months of back and forth, but she confirmed late on Thursday that she will support the measures when it’s introduced on Saturday.
“We have agreed to remove the carried interest tax provision, protect advanced manufacturing, and boost our clean energy economy in the Senate’s budget reconciliation legislation,” Sinema announced. “Subject to the Parliamentarian’s review, I’ll move forward.”
Sinema’s changes are good for manufacturers, hedge fund and private equity managers, but it also decreased the amount the proposal would have raised. To make up for the lost funds, the agreement added a 1% excise tax on stock buybacks for companies.
Getting both Manchin and Sinema on board was crucial to the Democrats’ plan in the evenly split Senate. They have the tie-breaker in Vice President Kamala Harris. The bill is now expected to pass as a reconciliation bill if Senate parliamentarianElizabeth MacDonough decides the bill meets all the rules to allow it. If so, the bill will avoid the filibuster threshold of 60 votes and will need only a majority vote.
Senate Majority Leader Chuck Schumer(D-New York), who had been in negotiations with Manchin for the better part of a year after Manchin blocked Build Back Better last December, said he expects all 50 Democrats to support the bill.
“I am pleased to report that we have reached an agreement on the Inflation Reduction Act that I believe will receive the support of the entire Senate Democratic conference,” Schumer said. “The final version of the Reconciliation bill, to be introduced on Saturday, will reflect this work and put us one step closer to enacting this historic legislation into law.”
The bill, which is a downsized version of Biden’s Build Back Better, is now titled the Inflation Reduction Act. It is aimed at combating climate change, investing in green energy programs and allowing Medicare to negotiate prices on prescription drugs. It represents the largest commitment to fighting climate change by the U.S. government ever.
