The Inflation Reduction Act will add more fuel to the “inflation fire,” a study of the bill’s provisions by a top Republican lawmaker showed Tuesday.
Rep. Jason Smith (R-MO), the ranking member of the House Budget Committee, released a fact sheet on Tuesday detailing how the Inflation Reduction Act uses budget gimmicks to and false sunsets to hide the true cost of Manchin’s alleged deficit reduction bill.
For instance, the Inflation Reduction Act would extend enhanced Obamacare subsidies for three years, which would cost $64 billion; however, if the program were extended to a ten-year window, the provision would cost $248 billion.
The legislation would also create $369 billion in climate change and energy security-related programs. The House Budget Committee Republicans found that the bill would cost well over $400 billion if the two-year sunsets were eliminated.
The legislation would also spend $80 billion to supersize the IRS’s ability to audit Americans’ taxes.
All in all, Smith said that this bill would create $114 billion in new debt when accounting for Manchin’s fake budget gimmicks and arbitrary offsets.
Smith said in a statement that the bill would only harm the American middle class and the country’s manufacturing sector at a time when the country has entered a recession.
The Missouri conservative elaborated:
Democrats are at it again using budget gimmicks and fake sunsets to create savings on paper – just like they did in the $5 trillion Build Back Broke bill that passed the House last year – while in reality delivering more spending, more inflation, and more debt. In total, the Democrats’ current inflationary reconciliation bill will spend $728 billion and add $114 billion in new debt. It will dump more fuel on the inflation fire while layering on top billions in new taxes that will hit middle class families and U.S manufacturers. One has to ask a simple question, how will this do anything to help lower prices?
Smith also noted that many of the tax increases and offsets for the bill amount to “gimmicks:”
- Less than two percent of the prescription drug price control “savings” arrive before 2025
- The bill says it would create $122 billion in “fake savings” by again delaying the Trump-era Rebate Rule that never went into effect
- The Congressional Budget Office (CBO) said it would not score potential savings that arise from increased audits from the IRS
- The bill’s 15 percent corporate minimum tax amounts to a “tried and failed 1980s tax policy” that was repealed by Democrats
The Joint Committee on Taxation (JCT) found that the corporate minimum tax that would hit the manufacturing sector would take 49.7 percent of the share of the Democrats’ proposed tax.
The highly influential Penn Wharton Budget Model found that the inflation reduction bill would likely have zero impact on inflation.
“American families cannot afford more Washington Democrat spending or new taxes when they are already paying President Biden’s $5,900 inflation tax, struggling to keep up with rising interest rates, and now a recession. Just as you cannot spend your way out of inflation, Washington cannot tax its way out of a recession,” Smith concluded in his statement. “Chuck Schumer and Joe Manchin should heed their own advice and not raise taxes while the economy is shrinking.”