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"Looks terrible": Dems prepares tax cuts for business as the broader agenda gets stuck

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Few have been envisioned by the Democratic Party as the biggest tax achievement in this year’s elections.

Some lawmakers have acknowledged the hassle of turning from family breaks to breaks that benefit billion-dollar businesses. Especially after long complaining that companies are not paying a fair tax burden.

Many semiconductor companies are well below the 21% corporate tax sticker price. Intel, one of the biggest beneficiaries of the plan, told investors last year that it paid 8.5%.

“It looks terrible,” Sen said. Michael Bennett (D-Colo.) Nevertheless, we plan to support breaks.

Like many of his colleagues, Bennett considers strengthening the country’s ability to produce ubiquitous chips a national security issue.

Democrats also say they’re just practical, moving the law where they have the right to vote, even if what they really care about, for example, child credits don’t go anywhere.

And a member of parliament like Sen. Sherrod Brown (D-Ohio) There are members who will benefit from the plan. Intel recently announced plans to build a large new semiconductor factory on the outskirts of Columbus.

“This will bring a lot of prosperity to my state and provide a lot of people with well-paid jobs,” he said.

Democratic Party plan After Sen. Joe Manchin (DW.Va.) Has killed many of its reconciliation dreams, including expanding its monthly child tax credit payment program and strengthening tax incentives for renewable energy. They still want to move smaller packages focused on health care.

Senate aims to approve semiconductor program next week with Speaker of the House Nancy Pelosi (D-Calif.) Her colleague says she will follow soon.

Investment credits are part of a $ 76 billion plan to drive the development of the US semiconductor industry.

Democrats say the pandemic has shown the danger of relying on foreign suppliers when the shortage of semiconductors has plagued many industries. Members of both parties are particularly concerned that the United States relies on chips manufactured at a giant foundry in Taiwan, wondering what would happen if there was an armed conflict between the island nation and China. ing.

“If most of the chips are produced in just a few places abroad, there is a great risk that the United States will not have the chips it needs to keep Americans safe in conflict,” the Senate said. Said.Finance Committee Chairman Ron Weiden (D-Ore.).

“Producing more chips domestically here means that our economy will be more resilient and our country will be safer and safer.”

The industry is also politically profitable by establishing facilities in states represented by major tax authorities.

It is a large employer in Weiden’s home state, where Intel, Analog Devices, Qorvo, On Semiconductor, Microchip Technology and others have facilities. Similarly, the Republican ranking of the Tax Commission, Sen. Mike Crapo Idaho’s Boise-based semiconductor giant Micron counts among his members.

The semiconductor program violates many of Manchin’s provisions for the law, but the ease with which lawmakers can move breaks contrasts with the Democratic Party’s fight against the Settlement Plan.

For one thing, semiconductor interruptions are temporary and have lasted for four years. This was a quarrel with Manchin over the expansion of child tax credits.

And while Manchin demanded that he pay the full amount of the settlement, some lawmakers are pushing the cost of semiconductor projects into the red.

The difference here is that Manchin’s vote is a consumable, as so many lawmakers endorse the package, and West Virginia Democrats have little power to demand from their colleagues. (Manchin spokesman did not respond to requests for comment.)

While there is bipartisan support for tax cuts, there is also bipartisan opposition, with lawmakers at both ends of the political spectrum blaming the proposal.

“Large-scale corporate welfare,” said Senate Budget Committee Chairman Bernie Sanders (I-Vt.).

“There is no doubt that there is a global shortage of microchips and semiconductors, which makes it difficult for manufacturers to manufacture the cars, mobile phones and electronics they need,” he said.

“But this is the question we should ask. American taxpayers tell the microchip industry 760 when semiconductor companies make tens of billions of dollars in profits and pay executives exorbitant compensation packages. Do I need to provide a blank check of $ 100 million or more? I think the answer to that question should be a clear “no”. “

And it’s a tax cut, but the Republicans are like lawmakers. Kevin Brady Texas, the pointman of his party on the Revenues Commission, is also dissatisfied with credit.

He said the government should not engage in the business of choosing and choosing the industries to subsidize. And Brady complains that the plan will bring significant benefits to projects already under development.

“I think it provides a large amount of subsidies to a limited group of companies and the project brings unreasonable wind and rain to companies already in progress,” he said.

Brady pointed out that Congress has a long history of renewing tax incentives before they expire, and predicted that breaks would not be temporary.

“As we know, there are some temporary tax credits [already in the code] — They tend to spread forever. “