The Biden administration is claiming that the Inflation Reduction Act will reduce inflation, help bring down the deficit, and not raise taxes on any American who makes less than $400,000 a year. That’s a really great idea. Unfortunately it’s not true.
The Daily Caller posted an article on Monday that explains what the bill will actually do. The article cites the Congressional Joint Committee on Taxation (JCT) as the source of its information:
The JCT found that taxes would go up by a total of $16.7 billion for Americans making less than $200,000, and by $14.1 billion for Americans making between $200,000 and $500,000.
Tax rates will begin to increase for a number of income groups as soon as the 2023 calendar year, according to the JCT. Those making less than $10,000 would see their average tax rate increase from 7.3% in 2022 to 7.6% in 2023, while those making between $30,000-$40,000 would go from 7.8% to 7.9%, and those making between $100,000-$200,000 would go from 19.1% to 19.4%.
That may not be a significant amount, but it is a tax rate on every American who pays taxes.
The article notes:
Senate Finance Committee Chair Ron Wyden’s spokeswoman Ashley Schapitl pushed back against the estimates, arguing that the JCT analysis is incomplete since “it doesn’t include the benefits to middle-class families of making health insurance premiums and prescription drugs more affordable,” Politico reported.
White House press secretary Karine Jean-Pierre made a similar argument Monday when pressed on the incongruities between the JCT estimates and Biden’s claims.
“The JCT’s report that we’re seeing is incomplete because it omits the actual benefits that Americans would receive when it comes to prescription drugs, when it comes to lowering energy costs like utility bills,” Jean-Pierre said.
The promise made was that the bill would not raise taxes. It raises taxes. The other savings may or may not happen. Green energy has been shown to increase utility bills–not decrease them, and a lot of money in this bill goes toward increasing America’s dependence on green energy.
The article concludes:
But it remains unclear how President Biden’s initial claim that taxes are not going to go up on those making under $400,000 dollars squares with JCT’s data, even if there are certain “indirect benefits” like “drug-price savings,” “mitigating the climate crisis” and “deficit reduction.” Tax rates on at least some individuals making under $400,000 will still increase, according to the JCT, a bipartisan committee, contrary to Biden’s claim.