By signing the Cut Inflation Act, President Biden is delivering on his promise to address the climate crisis and build an economy that works for working families. The Cut Inflation Act makes historic investments in America’s future while lowering health care and energy costs. This is the most aggressive action we have taken to address the climate crisis. It will reduce the deficit and ask the super rich and corporations to pay their fair share. And no one who earns less than $400,000 a year will pay a penny more in taxes.
President Biden and congressional Democrats have pushed back against special interests to pass this landmark legislation that builds a brighter future for young Americans by cutting costs, advancing environmental justice while building a cleaner future and expanding the bottom-up and middle economy.
ADDRESSING THE CLIMATE CRISIS
This law represents the most aggressive action the United States is taking to address the climate crisis and create clean energy solutions in American history. The law will reduce energy costs for families and create thousands of good jobs, while reducing climate pollution and ensuring a clean and secure future energy supply. It will be:
Reduce the pollution: The law would reduce approximately one gigatonne (one billion metric tons) of greenhouse gas emissions by 2030 and position America to meet President Biden’s climate goals of halving climate pollution by 2030 and reducing climate pollution by 2030. achieve net zero emissions by 2050.
Advancing Environmental Justice: Climate change is disproportionately impacting low-income communities and communities of color. The law will work to mitigate legacy pollution and ensure clean energy opportunities reach all Americans through:
- Create new Environmental Justice Block Grants, which will support community projects across the country, including pollution control in port communities where air pollution is especially deadly.
- Create a new clean energy and sustainability accelerator that will create national and local clean energy finance banks, which will help disadvantaged communities access the benefits of the law.
- Provide funds to tribal communities to bring clean, emission-free electricity to homes and build their climate resilience.
Reduce energy costs: The law makes it more affordable to purchase energy-efficient appliances, home improvements and more to reduce energy costs. Overall, the act puts America on track to meet the president’s climate goals, which will save each family an average of $500. per year on their energy bills, by covering:
- Efficient Appliances and Home Upgrades – The law provides direct-to-consumer rebates when households need to upgrade heaters, water heaters, ranges, ovens or other appliances with electrical appliances and more energy efficient. Households can save up to 30% with home building project tax credits on windows, doors, insulation or other weather protection measures that prevent energy from s escape from houses. These upgrades can reduce future utility bills by at least $350 per year.
- Home Energy Systems – When households want to install solar panels on their roof, they can save up to 30% through tax credits. For example, an average family installing solar power using this credit would save $9,000 on their electricity bill over the life of the system, or about $300 per year.
- Cleaner cars and trucks – The law will lower the list price of electric vehicles, providing Americans with tax credits of up to $7,500 for new electric vehicle purchases and $4,000 for new electric vehicle purchases. ‘opportunity. This measure could in particular help young Americans buy their first car and avoid the gas pump for good.
REDUCED HEALTHCARE COSTS
Since 2014, the Affordable Care Act (ACA) has helped provide quality health insurance coverage for people who are not covered by work. Yet health insurance remains unaffordable for many Americans. During his campaign, President Biden promised to build on the ACA by making premium tax credits more generous and reducing healthcare premiums for working families. The President’s US bailout delivered on that commitment by improving premium tax credits. However, these improvements are due to expire at the end of 2022. The Inflation Reduction Act extends them until 2025:
- Saving 13 million Americans hundreds of dollars a year. About 13 million Americans will save on average about $800 annually on health insurance premiums. Young people will also benefit significantly, as more than 3.5 million people between the ages of 18 and 34 benefit from market health care plans.
- About 3 million more people will be covered next year thanks to this extension. Although the uninsured rate fell to lowest level in US history early 2022, young people aged 18 to 24 continue to be the most likely to be uninsured.
- By expanding access to coverage, the law will improve health outcomes; improve financial security by reducing medical debt and rent and mortgage arrears; and low racial disparities in health coverage and access to care.
MAKE THE TAX CODE FAIR
President Trump and congressional Republicans’ tax bill of 2017 only made an unfair tax system worse. The Cut Inflation Act of 2022 is a crucial step in making our tax code fairer. It will increase revenue by:
- Make sure high-income people and big businesses pay the taxes they already owe.
- Go after large, profitable corporations that currently get away with paying no federal income tax.
- Impose a 1% surtax on corporate stock buybacks that will incentivize companies to invest.
Tax law reforms will not only raise revenue to fund much-needed investment to cut costs and fight climate change, they are also an important part of building an economy that rewards hard work rather than wealth and doesn’t let the rich and powerful get away with playing by a separate set of rules. Millions of working families will have better access to the benefits they are entitled to under the tax code and can get their questions answered quickly and efficiently, thanks to the law’s transformational investments in the Internal Revenue Service. In addition, no family earning less than $400,000 a year will see their taxes increase by a single penny.