Biden and Democrats win as his climate and health plan passes

A big boost to renewable energies, cheaper drugs and a corporate tax: that’s what Joe Biden’s master investment plan, which was finally approved by the US Congress on Friday, provides. A victory for the White House tenant that the Democrats needed before the legislative elections in November.

  • 370 billion for the climate

This is the largest investment ever made in the United States in the fight against climate change.

Instead of imposing penalties for polluters, the law provides a series of fiscal incentives intended to shift the US economy toward non-fossil energy sources. Producers and consumers of wind, solar and nuclear energy have been offered a series of tax breaks.

Under this reform, an American will get up to $7,500 in tax credits for purchasing an electric vehicle. The installation of solar panels on its roof will be supported by 30%.

About $60 billion is also planned for building wind turbines, solar panels and electric vehicles in the United States.

The same amount goes to a series of programs to help the most humble families with the energy transition, particularly through the renovation of their homes.

This reform also includes huge investments to enhance the forests’ resilience to the fires that are ravaging the country and to protect coastal areas from hurricanes. This project should allow the United States to reduce carbon dioxide emissions by 40% by 2030 compared to 2005.

  • 64 billion for health

The second part of this major investment plan aims to partially correct massive inequalities in access to care in the United States, notably by lowering drug prices.

Medicare, a public health insurance system for people over 65 and on low incomes, will for the first time be able to negotiate prices for some drugs directly with drug companies, thus obtaining more competitive rates.

The plan would also force drug companies to offer consumers discounts on some drugs whose prices are rising faster than inflation.

The bill also plans to extend protections from the Affordable Care Act, the health insurance code known as Obamacare, Barack Obama’s main law, through 2025.

  • Companies taxed at 15%

In parallel with these huge investments, the “Law on Inflation Reduction”, as it is called, aims to reduce the public deficit by introducing a minimum tax rate of 15% for all companies whose profits exceed one billion euros.

This new tax is intended to prevent some large companies from using tax loopholes that have allowed them to pay well below the theoretical rate.

It is estimated that the measure could generate more than $258 billion in US federal revenue over the next 10 years.

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