Provisions in final version of climate, tax, and health bill

WASHINGTON — After months of painstaking negotiations, Democrats are set to push through a climate, tax, and health care package that would salvage key elements of President Biden’s domestic agenda.

Here’s what’s in the final package:

Climate

The bill includes the largest expenditures ever made by the federal government to slow global warming and to reduce demand for the fossil fuels.

It would invest nearly $400 billion over 10 years in tax credits aimed at steering consumers to electric vehicles and prodding electric utilities toward renewable energy sources.

Energy experts said the measure would help the United States to cut greenhouse gas emissions about 40 percent below 2005 levels by the end of this decade. That puts the Biden administration in striking distance of meeting its goal of cutting emissions roughly in half by 2030. Far more will be needed to help keep the planet from warming to dangerously high global temperatures, scientists said, but Democrats considered it a momentous first step after decades of inaction.

At the same time, Democrats agreed to a number of fossil fuel and drilling provisions as concessions to Senator Joe Manchin of West Virginia, a conservative state that is heavily dependent on coal and gas.

The measure would assure new oil drilling leases in the Gulf of Mexico and Alaska’s Cook Inlet. It would expand tax credits for carbon capture technology that could allow coal or gas-burning power plants to keep operating with lower emissions. And it would mandate that the Interior Department continue to hold auctions for fossil fuel leases if it plans to approve new wind or solar projects on federal lands.

The tax credits include $30 billion to speed the production of solar panels, wind turbines, batteries, and critical minerals processing; $10 billion to build facilities to manufacture things like electric vehicles and solar panels; and $500 million through the Defense Production Act for heat pumps and critical minerals processing.

There is $60 billion to help disadvantaged areas that are disproportionately affected by climate change and it would undo a 10-year moratorium on offshore wind leasing established by President Donald Trump.

Health care

For the first time, Medicare would be allowed to negotiate with drugmakers on the price of prescription medicines, a proposal projected to save the federal government billions of dollars. That would apply to 10 drugs initially, beginning in 2026, and then expand to include more drugs.

Opponents argue that the plan would stifle innovation and the development of new treatments by cutting into the profits that drug companies can plow into their business, while some liberals expressed frustration that the policy would be too slow to take hold. It would be the largest expansion of federal health policy since passage of the Affordable Care Act.

The package would cap the out-of-pocket costs that seniors pay annually for prescription drugs at $2,000 and would ensure that seniors have access to free vaccines.

As part of the $1.9 trillion pandemic aid law that Democrats muscled through last year, lawmakers agreed to broaden subsidies available under the Affordable Care Act. That proposal lowered premiums for almost every American who relies on the program’s marketplace

The latest package would extend those subsidies, now set to expire at the end of the year, for an additional three years.

Taxes

Democrats proposed a complex change to the tax code: a new 15 percent corporate minimum tax on the profits companies report to shareholders. It would apply to companies that report more than $1 billion in annual income on their financial statements but that are also able to use credits, deductions, and other tax treatments to lower their effective tax rates.

Democrats extended a limit on tax deductions for business losses that was enacted as part of the President Trump tax cuts in 2017.