The Arizona Democratic centrist announced that she’s signed off on the legislation after winning tweaks that include the removal of a narrowed loophole for taxation of certain investment income, a provision known as carried interest.
…The new agreement with Sinema includes a new 1 percent excise tax on stock buybacks that will bring in $73 billion, far more than the $14 billion raised by the carried interest provision, according to a Democrat familiar with the deal.
The deal with Sinema also adds roughly $5 billion in drought resiliency to the bill, according to another person familiar, and changes portions of the corporate minimum tax structure to remove accelerated depreciation of investments from the agreement. That depreciation-related change will cost about $40 billion [Burgess Everett and Marianne Levine, “Sinema Signs onto Dems’ Party-Line Bill Ahead of Momentous Saturday Vote,” Politico, 2022.08.04].
Sinema says protecting accelerated depreciation will help manufacturers buy new equipment more quickly. She also says she’ll work on reforming the carried interest loophole later in separate legislation.
Senator Thune doesn’t care which tax breaks his rich friends get to keep; the Senate GOP’s #2 is calling the budget deal names and vowing zero Republican votes for the Inflation Reduction Act. We’re still waiting for the parliamentarian to rule whether the bill can advance under budget rules allowing simple majority votes rather than requiring 60 votes to end filibusters.