The Senate on Sunday passed the Inflation Reduction Act (IRA) along party lines, 51-50, handing Democrats a crucial legislative win as the midterm cycle ramps up — despite GOP objections at the billions in spending and drug pricing reforms.
The sprawling climate, tax and health care legislation is now set up for quick passage in the Democratic-controlled House, with timing still to be announced, before President Joe Biden signs it into law.
Included in the bill, supporters are quick to highlight, are measures to foster job creation, raise taxes on large corporations and the wealthy, allow Medicare to negotiate down some prescription drug costs, expand the Affordable Care Act health care program and invest in combating climate change by implementing tax credits for clean energy initiatives, among other things.
Vice President Kamala Harris cast the tie-breaking vote in the Senate with all Democrats in support of the legislation and all Republicans opposed. The proposal was passed via the budget reconciliation process, which requires a simple majority rather than the 60 votes typically needed to overcome a filibuster.
The rules of reconciliation, however, limit what can and cannot be passed with 51 votes — strictures that narrowed the legislation’s scope even in the final days before the vote.
The legislation’s tax provisions, prescription drug-pricing reform, as well as boosted IRS tax enforcement measures, are anticipated to raise an estimated revenue of $739 billion — $300 billion of which Democrats say would go toward reducing the deficit.
The plan would reduce federal budget deficits by $102 billion over 10 years, according to the nonpartisan Congressional Budget Office. Despite the bill’s name, however, the CBO found that it would have a minimal affect on high inflation in the short-term — something Democrats have conceded when pressed.