Even as negotiations over Democrats’ Build Back Better legislation has stalled in the Senate, President Biden and other Democrat leaders are still pushing for its provisions to be passed in some form this year.
During a press conference, President Biden told reporters “I’m confident we can get pieces, big chunks of the Build Back Better law signed into law.”
Build Back Better isn’t just filled with a plethora of tax increases and wasteful spending, but also an abundance of tax credits and deductions as giveaways to left-wing special interests.
One provision allows trial attorneys to immediately deduct contingency-fee expenses including costs spent on depositions, discovery, expert testimonies, and more. Currently, trial lawyers handle these costs and then receive a share of the client’s settlement or award.
Under our current tax system, trial lawyers are already able to write off these expenses if they do not win the case or if the case is settled. However, this new provision will subsidize contingency fee cases and allow trial lawyers to launch frivolous lawsuits against businesses.
Nearly 95 percent of lawyers’ political donations go to Democrats. The American Association for Justice, the top trial lawyer lobby, directs over 97 percent of its political contributions to Democrats.
The legislation also contains a giveaway for wealthy taxpayers in blue states like New York and New Jersey. The Tax Cuts and Jobs Act (TCJA) included a change limiting the State and Local Tax (SALT) Cap Deduction to $10,000. This deduction was capped as part of a net tax cut that included doubling the standard deduction from $12,000 to $24,000 and reducing income tax brackets.
BBB would increase the cap on deductions from $10,000 to $80,000, a change that would benefit wealthy taxpayers and do little or nothing to help the middle class.
According to the Center for American Progress, 98.6 percent of taxpayers with incomes of less than $100,000 and 84 percent of those with incomes between $100,000 and $200,000 would see no benefit at all from the SALT cap repeal.
This is a blatant partisan tax break for Democrat party supporters in high-tax blue states and has little to do with alleviating the tax burden of the middle class as some Democrats have suggested.
The legislation also contains countless provisions pertaining to a “green economy” such as pushing investments in the “green workforce” and providing a hefty refundable credit for “Environmental Justice” programs.
Democrat lawmakers are looking to make investments in the “green workforce” by setting aside about $10 billion for various niche green tax credits. For example, about $400 million will be reserved in tax credits each year for projects specifically in “automotive communities.” The bill defines automotive communities as communities that have “experienced major job losses in the automotive manufacturing sector.” What may have initially seemed like an opportunity to help a disenfranchised community is actually just a blatant handout for unionized autoworkers.
The plan even includes multi-billion-dollar grants and credits for the promotion of unspecified “environmental justice” spending at higher education institutions. The legislation does little to specify any criteria for environmental justice programs but allows an institution to have 20 percent of its costs within five years covered; while HBCUs and minority-serving institutions (MSIs), can have 30 percent of their costs covered.
Large swaths of this bill contains giveaways meant to assist Democrat party supporters. Even as the legislation is stalled in the Senate, all lawmakers should look to reject this legislation and its shameless giveaways.