Dem’s New Spending Bill Imposes Methane Tax To Fund ‘Environmental Justice’ Programs

Senate Democrats agreed Wednesday to the biggest climate spending package in U.S. history, including billions in new taxes on methane emissions that will fund “environmental justice” programs for marginalized communities.

Democratic Sens. Joe Manchin and Chuck Schumer salvaged a deal on an economic bill they dubbed “The Inflation Reduction Act of 2022” that places new fees on methane emissions and devotes hundreds of billions of dollars to climate change initiatives, according to the bill’s text. The proposed legislation would place new taxes on energy firms’ methane emissions beginning in 2025, invest nearly $370 billion in “energy security and climate change” and spend billions to protect disadvantaged communities from the effects of climate change.

The package will spend $60 billion on protecting low-income areas and communities of color that are more affected by environmental pollution. The bill will also offer large sums of money to the green industry, including direct-pay options to support domestic green energy manufacturers over the next five years. (RELATED: Joe Manchin Says He Will Support Reconciliation Package, Claims It Is ‘Responsible Path Forward’)

The bill will raise about $739 billion in total, with a large portion of the money coming from a 15% corporate minimum tax and increased tax enforcement operations conducted by the Internal Revenue Service, as well as potential savings from enabling Medicare to negotiate prescription drug prices, according to the package summary.

Climate provisions in the deal also provide tax credits for electric vehicles (EVs) that can offer up to $4,000 to subsidize the purchase of used vehicles and $7,500 for new vehicles. Individuals and married couples with incomes under $75,000 and $150,00 would be eligible for the tax breaks for used electric cars, while those with incomes up to $300,000 would be eligible for the write-offs on new vehicles.

The average EV owner has an annual household income of more than $100,000, according to a 2021 report published by The Fuels Institute. Meanwhile, the average price of a new EV is roughly $66,000, according to Kelly Blue Book.

WASHINGTON, DC – JUNE 9: Sen. Joe Manchin (D-WV) walks through the Dirksen Senate Office building on Capitol Hill on June 9, 2021 in Washington, DC. Over the weekend, Manchin announced that he will not support the For The People Act, the voting rights legislation that Democrats are trying to pass through the Senate. (Photo by Drew Angerer/Getty Images)

The bill also provides consumers with tax credits for making their homes more energy-efficient and supports the development of solar and wind farms, according to the Democrats’ summary of the package.

The newly reached consensus on the package comes after Manchin struck down his party’s climate provisions in the bill in mid-July causing Democrats, climate activists, and green energy groups to pressure the party to reach an agreement prior to the August 5 recess.

Democrats are hoping to advance the bill without Republican votes through the reconciliation process, where bills tied to the budget can pass with a simple majority.

“This is the action the American people have been waiting for,” said President Joe Biden in a statement about the bill on Wednesday.

The White House and the offices of Sens. Schumer and Manchin did not immediately respond to the Daily Caller News Foundation’s requests for comment.

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