Curbing Inflation Act: 5 Benefits for California Residents

CALIFORNIA – Senate-approved Democratic spending bill that would provide tax credits for clean-energy household products and electric vehicles, savings on prescription drugs and health insurance, and others consumer benefits to California residents are expected to pass the House on Friday before heading to President Joe Biden’s office.

The 755-page Inflation Reduction Act, as the spending bill is called, passed the Senate on Sunday in a party vote.

California’s two senators, Dianne Feinstein and Alex Padilla, both Democrats, voted in favor of the Cut Inflation Act.

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Feinstein shared that it’s a “huge win” for American families and tackles issues like climate change, drought and rising health care costs. “I’m proud to support him,” Feinstein said.

Padilla accepted. “It is important to note that the Cut Inflation Act will reduce the cost of life-saving medicines because no one should have to choose between affording health care or paying their rent or mortgage,” Padilla said. in a recent press release. “And it will reduce the deficit by ensuring billion-dollar corporations pay their fair share of taxes. With the passage of this landmark legislation, Democrats are delivering on their longstanding promises and investing in safety the prosperity of our communities.”

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California representatives are preparing for their turn to vote on Friday. With 42 Democratic representatives and 11 Republicans. As expected, Republicans and Democrats are split on the landmark bill. California’s 1st District Rep. Doug LaMalfa (R-Oroville) tweeted his thoughts Thursday, saying “the American people have suffered from record inflation, historic gas prices and now a deepening recession. “, he wrote, adding that “Americans simply cannot afford to foot the bill” for another spending program.

Meanwhile, Rep. Mike Levin, (D-Oceanside) tweeted his support for the bill. “Families will pay less for health care, prescriptions and energy thanks to the Cut Inflation Act,” he wrote. “Looking forward to sending the bill to President Biden’s office later this week.”

The climate, tax and health care bill provides $433 billion in new spending that Democrats say is more than offset by $739 billion in revenue, specifically:

  • $313 billion from a 15% minimum corporate tax
  • $288 billion from prescription drug pricing reform
  • $124 billion from IRS tax enforcement reform
  • $14 billion from closing the carried interest loophole

House Speaker Nancy Pelosi hailed their “landmark legislation” for “lowering kitchen table costs, lowering the cost of health care for Americans, creating millions of well-paying jobs and addressing the climate crisis”.

Republicans called the measure “reckless spending” that adds “fuel to the fire of inflation that is burning in Americans’ paychecks.”

Inflation cooled in July as gasoline prices fell, but Americans continued to pay more for groceries, rent and other items, according to the government’s index report. consumer prices released on Wednesday.

Here are 5 things California residents should know about the bill:

Time to hook up?

Middle and working class consumers – those earning $150,000 or less per year (or $300,000 for co-filers) will be eligible for tax credits of up to $7,500 for new vehicles “clean” qualified made in North America. Consumers earning $75,000 or $150,000 for joint filers may also qualify for a tax credit of up to $4,000 for the purchase of clean used vehicles.

Among those eligible for the maximum credit are vehicles manufactured by General Motors and Tesla; the less efficient the vehicle, the lower the tax credit, NBC reported.

Tax credits for a “clean” life

The legislation increases credits from 10% to 30% for installing Energy Star products in homes and non-commercial properties. According to the Senate Finance Committee, these products include “solar electricity, solar water heating, fuel cells, small wind power and geothermal heat pumps.”

The amount of savings Americans would see depends on their investments in improving the energy efficiency of their homes. According to a summary by the Bipartisan Policy Center, they could claim $1,200 in tax credits per year, including $600 for energy-efficient windows and $500 for energy-efficient doors, but could claim up to $2,000 if their upgrades level included biomass stoves and heat pumps.

Reduced drug costs for older Americans

Starting in 2025, drug spending for Medicare beneficiaries would be capped at $2,000. There’s no cap now, and the average Medicare beneficiary spent $5,460 on out-of-pocket expenses in 2016, according to research by the nonpartisan Kaiser Family Foundation.

Older Americans would also receive recommended vaccines free of charge, including those for COVID-19 and shingles.

The legislation also caps monthly insulin outlays at $35 per month for Medicare beneficiaries. Senate Democrats tried to extend the cap to all Americans, but Republicans argued that the Senate’s strict budget rules prohibit that, NBC News reported.

No shock Affordable Care Act sticker

The measure extends funding for the American Rescue Act until the end of 2025. Without it, the 13 million Americans who receive their health insurance through the Affordable Care Act market would have faced a steep hike bonuses this fall.

Additional financial assistance is available for people who are already eligible for subsidized health plans in the ACA Marketplace. The legislation also extends ACA subsidies to middle-class earners who previously could not afford health insurance, according to the Kaiser Family Foundation.

More neighborhood investments

The legislation would channel $60 billion in grants and tax credits to improve air quality monitoring, improve transportation and invest in clean energy in poor and vulnerable communities.

It also specifically targets neighborhoods close to industrial sites. For example, it provides $1 billion in grants to improve the energy efficiency of affordable housing.

Environmental justice advocates say the measure falls short of addressing needs, but addressing some of the most pressing issues.

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