What is in the landmark Bill passed by the US Senate?

WASHINGTON (BLOOMBERG) – The United States Senate passed the Democrats’ landmark tax, climate and health-care bill, setting up the legislation for House approval and President Joe Biden’s signature.

After more than a year of stop-and-start negotiations, Democrats on Sunday (Aug 7) agreed to a narrow bill to invest in energy initiatives, curb drug prices and reduce the deficit, paid for by new corporate taxes.

The legislation is far from the roughly US$4 trillion (S$5.5 trillion) to reshape the American economy that Mr Biden first envisioned when taking office, but the bill still gives Democrats something to show voters ahead of the November mid-term elections.

Here are the highlights of what’s in the deal:

Corporate Minimum Tax

The bill imposes a 15 per cent minimum corporate levy on companies that have traditionally been able to pay little to no taxes because they were eligible for a long list of credits and deductions.

This measure is known as the book tax, because it is applied to a company’s book, or financial-statement, earnings – rather than the income calculation traditionally used for tax purposes.

The private equity industry scored a last-minute win when several Democrats voted with Republicans to create a carveout that means fewer companies owned by investment firms will have to pay the tax.

The regular, 21 per cent corporate rate is left untouched, maintaining a key part of former President Donald Trump’s 2017 tax law.

Stock Buyback Tax

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