Today, President Biden held a press conference detailing his Build Back Better (BBB) program, which he expects will pass both chambers of Congress. The original budget, as proposed by Senator Bernie Sanders, was priced at $6 trillion. Lawmakers reduced the budget for the BBB program down to $3.5 trillion and passed it in the house. Here's what the latest budget includes, what was cut from the program, and how the program will be funded.
What's In the Latest Build Back Better Program
Today President Biden laid out the Build Back Better Framework, which comes to a total of $1.85 trillion. President Biden is confident this framework will be accepted by lawmakers, but gave no answers as to who supported it or if he expected it to pass this week. Here's what's included in the BBB framework.
- $555 billion for clean energy and climate investments. This part of the BBB framework extends clean energy tax credits for clean energy manufacturing, clean passenger and commercial vehicles, and much more. It also invests in environmental clean up and a Civilian Climate Corps. Monetary incentives for clean energy technology and manufacturing will also be included.
- $400 billion for child care and preschool. The provision includes universal Preschool for all 3-and-4-year old's. Families making up to 250% of their state's medium income will pay no more than 7% of their income on child care. Parents must be working, seeking work, in training, or taking care of a serious health issue to qualify.
- $200 billion for child tax & earned income tax credits. The increased child tax credit for eligible families will become permanent. The earned income tax credit will also be extended for one year for workers without children.
- $150 billion for home care. This will strengthen an existing Medicaid program to improve working conditions for home care workers and end the backlog of hundreds of thousands of families waiting for home care. Biden said this will enable the elderly to "live with the dignity they deserve," in their own home rather than in a nursing facility.
- $150 billion for housing. This money will go towards rental and down payment assistance, as well as building, preserving, and improving more than 1 million affordable rental and single-family homes nationwide.
- $130 billion for ACA credits. The Affordable Care Act premium tax credit will be extended through 2025, insuring around 3 million Americans. It also expands the program to make it available for an additional 4 million who are currently uninsured.
- $100 billion for immigration. This reduce a backlog of nine million visas and improve the immigration process.
- $90 billion for equity & other investments. This provision includes investments in pandemic preparedness, supply chain resilience, child nutrition, disadvantaged farmers, Native communities, maternal health, community violence initiatives, and more.
- $40 billion for higher education and workforce. Under this provision, the maximum Pell grant amount will be increased b y $550 and expanded to include DREAMers. It also provides support for Historically Black Colleges & Universities (“HBCUs”), Hispanic Serving Institutions (HSIs), Minority Serving Institutions (“MSIs”), and Tribal Colleges and Universities (“TCUs”).
- $35 billion for Medicare. This will enable Medicare to cover the costs of hearing aids and hearing examinations.
What The Build Back Better Program Doesn't Include
While the $1.85 trillion package includes several components from the $3.5 trillion package, some adjustments have been made. Here are some of the items that were cut or trimmed.
- Prescription drug pricing changes. In the $3.5 trillion budget, one of the proposals was to cut prescription drug prices. The proposal would have given the government the authority to negotiate prices directly with manufacturers.
- Paid family and medical leave. Originally, billions of dollars were allocated to the Committee on Finance to support Paid Family and Medical Leave. It is not included in the new framework.
- Free community college. The new framework extends the Pell grant by $550, but it dos not cover the full expense of community college like was previously included.
- VA facility upgrades. $18 billion was previously allocated to the Committee on Veterans Affairs to upgrade VA facilities, but it was struck as well.
- Medicare benefit expansion. Billons of dollars were originally allocated to Medicare to include vision and dental coverage, but they were not included.
How The Build Back Better Program Proposes It Will Be Paid For
President Biden said that his Build Back Better program is "fully paid for." He commented, "Over the next ten years, this will not add to the deficit at all, it will actually reduce the deficit." Here is how the White House proposes the program will be paid for over the next 10 years.
- $400 billion from IRS Investments to Close the Tax Gap. Under this provision, the IRS will receive a huge investment to hire "enforcement agents who are trained to pursue wealthy evaders" who make over $400K per year, as well as modernize their IT systems, and invest in customer service.
- $350 billion from Corporate International Reform. Corporations who move part of their business overseas to save on labor costs or for other tax benefits will be subject to a 15% minimum global tax on foreign profits. This is intended to incentivize companies to remain in the United States rather than moving abroad.
- $325 billion from a 15% minimum corporate tax on large corporations. Corporations who report to their shareholders a total profit of $1 billion or more will have a 15% minimum tax imposed.
- $250 billion by closing the Medicare tax loophole for the wealthy. This provision would "close the loopholes that allows some wealthy taxpayers to avoid paying the 3.8% Medicare tax on their earnings."
- $230 billion from AGI surcharge on the top 0.02%. The BBB framework will add an additional tax to the top .02% of Americans (multi-millionaires and billionaires). Those making more than $10 million will be subject to an additional 5% tax and those making $25 million or more will have the 5% and a 3% surtax on their income.
- $170 billion by limiting business losses for the wealthy.
- $125 billion from a stock buybacks tax. Corporate stock buybacks will now incur a 1% surcharge.
When The Build Back Better Program Could Pass Congress
The White House states that it believes Congress will accept and approve this bill. After negotiating with progressive lawmakers and moderates, including Senators Manchin and Sinema, and Congressional leaders, "President Biden is confident this is a framework that can pass both houses of Congress, and he looks forward to signing it into law." So far there has been no comment from lawmakers on when this may be voted on.
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