On Sunday, August 7, the United States Senate passed the Inflation Reduction Act: the most significant climate investment in the history of the country. This bill is expected to take the US much closer to the goal of cutting its net greenhouse emissions in half by 2030 with respect to 2005.
It is estimated that the "energy security and climate change" portion of the bill will lead to an investment of $369 billion. This will focus on lowering energy costs, increasing carbon-free electricity production, and reducing carbon emissions by 40 percent by 2030. The bill also extends the Affordable Care Act by another three years with an investment of $64 billion. $5 billion has been put aside for drought relief.
The bill raises revenue by placing a 15 percent corporate minimum tax rate on companies with annual financial statement income higher than $1 billion as well as other taxations on the stock market, changing prescription drug pricing, and expanding the Internal Revenue Service ability to fight tax evasion.
Estimates from Joint Committee on Taxation estimate and Congressional Budget Office put a total revenue raised at $739 billion, leaving about $300 billion for deficit reduction.
The bill passed 51 to 50, with all republican senators voting against the measures to fight the climate crisis, reduce the cost of drugs for the elderly, and reduce the deficit. Vice President Kamala Harris broke the tie. The bill now moves to the House of Representatives, where it is expected to pass on Friday, as the lower house of Congress plant to reconvene briefly during its summer recess.
Once passed, the bill will move to the White House, where President Biden will sign it into law.