Robert SchroederVictor Reklaitis
Democrats’ Inflation Reduction Act passed the House of Representatives in a 220-207 vote on Friday after clearing the Senate last weekend, and with it, some big changes could be coming to key sectors of the U.S. economy.
The measure, though a slimmed-down version of President Joe Biden’s Build Back Better proposal, would pump billions of dollars into climate and healthcare programs, while levying new taxes on big companies and stock /zigman2/quotes/210599714/realtime SPX +2.41% buybacks to pay for it all.
Below is a look at some of the key provisions of the bill, which passed the Senate in a 51-50 vote on Sunday , as Vice President Kamala Harris broke a tie. No Republicans in the Senate or House voted for it, as the GOP argued the measure wouldn’t live up to its name as an inflation-fighting measure.
The legislation is expected to get signed into law quickly by Biden.
The bill includes $369 billion for climate and energy provisions and would accelerate the U.S.’s transition away from fossil fuels.
As MarketWatch reported, the bill’s energy and climate-focused /zigman2/quotes/205740995/composite ICLN +2.88% incentives are peppered with rebates and tax credits that will directly impact households. They address heat pumps, appliance efficiency, solar panels, electric vehicles /zigman2/quotes/203558040/lastsale TSLA -8.35% /zigman2/quotes/208911460/composite F +2.77% and more.
Sen. Joe Manchin, a key West Virginia Democrat, also said he’d secured a side agreement to advance an energy-permitting reform package before the end of September — which could make it easier to build pipelines.
Investors earlier this week saw an immediate impact of the Senate’s advancing the bill, as shares of solar /zigman2/quotes/209356097/composite FSLR +2.64% , EV and fuel-cell /zigman2/quotes/203763461/composite FCEL +2.79% companies all rallied Monday.
Medicare would be able to negotiate the cost of some prescription drugs with pharmaceutical companies /zigman2/quotes/200345932/composite PJP +0.81% under the deal — a provision that’s been blasted by the industry, which says the measure would throttle innovation .
The bill also caps out-of-pocket drug costs for Americans on Medicare at $2,000 a year, beginning in 2025.