Will the Inflation Reduction Act actually reduce inflation? How will the corporate minimum tax work? An economist has answers
The U.S. is about to spend US$490 billion over 10 years on reducing greenhouse gas emissions, improving health care and reducing the federal deficit. Where’s all that money coming from?
Nirupama Rao, a Univeristy of Michigan economist, examine how the new law will raise enough revenue to pay for clean energy tax credits, Affordable Care Act subsidies and incentives for manufacturers to use cleaner technologies, among other initiatives. We also wanted to know, given its name, will the Inflation Reduction Act actually bring down inflation?
What are the main revenue components in the bill?
The new law funds itself primarily through a mixture of tax-related measures and health care savings. In fact, the revenue it’s projected to raise more than pays for the new spending, reducing the deficit by roughly a quarter of a trillion dollars over 10 years.