Plus, why the US is fighting with Moderna over its vaccine
â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â â [The Fisc]( Â Â By Yuval Rosenberg and Michael Rainey Hey, itâs almost Friday! But before we get ahead of ourselves, today is also Veterans Day â and as we express our deepest gratitude to those who served and their families, we can also be thankful that, as The New York Times [notes]( itâs the first Veterans Day in two decades without troops engaged in an active war. Itâs also an appropriate time to point out this [troubling Roll Call story]( highlighting how hunger among servicemembers and veterans is contributing to rising suicide rates for those groups. Hereâs what else you need to know. Bidenâs Build Back Better Plan Would Cut Taxes for Most Households: Analysis
The latest version of President Bidenâs Build Back Better bill would provide a tax cut on average to most households in 2022 while increasing taxes on the top 1%, according to a new [analysis]( from the nonpartisan Tax Policy Center. The top 1% of households â those earning more than $885,000 â would pay roughly $55,000 more per year on average under the proposed changes to the tax code. Those in the top 0.1% ($4 million and higher) would pay about $585,000 more per year on average.
When all major tax provisions â which touch on a variety of areas such as health care coverage and excise taxes â are taken into account, about 20% to 30% of middle-income households would see a small tax increase in 2022, totaling less than $100 on average. Higher-income households earning $200,000 to $500,000 would pay about $230 more. Considering just direct taxes, less than 0.1% of households earning less than $500,000 would see a tax hike in 2022, though the picture changes in 2023, when some tax provisions expire and some kick in, resulting in many households seeing a tax increase relative to 2022. (TPC notes that âanalyzing the House Democratsâ plan is especially complicated because the effective dates of its many tax provisions vary widely.â) TPC also points out an odd quirk in the Democratic proposal related to the state and local tax (SALT) deduction. In its most recent iteration, the plan would raise the cap on the SALT deduction to $80,000 from 2021 to 2031, which would provide the majority of high-income households with an overall tax cut. Households earning between $500,000 and $1 million a year would end up getting a $6,130 tax cut on average in 2022, according to one TPC [table]( while those earning more than $1 million would receive a tax cut of $68,300. âThanks to the SALT cap increase, over two-thirds of millionaires will get a TAX CUT under Build Back Better,â [tweeted]( Marc Goldwein of the Committee for a Responsible Federal Budget. Whether that tax provision makes it into the final legislation remains to be seen. The bottom line: âWhile the latest version of Bidenâs signature initiative drops or revises many of his original proposals, it still reflects one key goal,â says TPCâs Howard Gleckman. âIt would raise taxes on high income households and corporations while reducing, or at least not raising, taxes for the vast majority of low- and moderate-income households.â Quotes of the Day
âBidenâs original tax proposals were progressive; they raised a lot of money from the top end; they were efficient and effective without creating new loopholes. Now, it seems we are left grasping at ridiculous revenue-raisers and a bunch of gimmicks.â â Steve Rosenthal of the Tax Policy Center, in a [Washington Post article]( examining how the White Houseâs initial tax proposals have been whittled down in response to opposition from some Democrats. âTo meet the demands of Sen. Kyrsten Sinema (D-Ariz.), the White House agreed to drop a proposed 3 percent tax on taxpayers earning over $5 million, instead agreeing to target the higher tax to those earning more than $10 million,â the Postâs Jeff Stein reports. âThe Biden administration also agreed to pull a proposed tax in late October targeting 700 billionaires after it faced criticism from a number of top Democrats, including House Speaker Nancy Pelosi (Calif.), who complained in one phone call with senior party officials on Oct. 26 that the plan amounted to a publicity stunt, two people familiar with the matter said. Sen. Joe Manchin (D-W.Va.) also raised substantive objections to the plan.â Stein adds that a new White House plan to impose a 15% minimum tax on corporations now faces objections from renewable-energy groups who are concerned that it could undermine the desired effect of new tax credits to promote investments in clean energy. âItâs such a piddling increase. One percent is not going to do much of anything.â â Ed Yardeni, president of investment advisory firm Yardeni Research, talking to [Politico]( about Democratsâ proposed 1% tax on stock buybacks. The tax, projected to produce $124 billion over 10 years, targets companies that buy their own shares in order to boost prices, providing larger payouts for company executives. Some market analysts say the tax is so small that it wonât have much effect on companies considering buyouts. âDo you want to pay it? No,â said Howard Silverblatt of S&P Dow Jones Indices. âBut if youâre buying stock on a continuing basis, your share price is moving more than 1 percent and very often it will move more than one percent â up or down â in one day.â Moderna and the NIH Are Fighting Over Patent Rights to the Covid Vaccine
The Moderna vaccine against Covid-19 has become the subject of a [bitter patent fight]( with the National Institutes of Health insisting that three government scientists worked with the company on the genetic sequence used in the vaccine to trigger an immune response and should be named in the companyâs patent application. The company, which excluded the government scientists in a July patent application, disagrees. It says that only Modernaâs scientists came up with the mRNA sequence used in the vaccine. âThe dispute is about much more than scientific accolades or ego,â Sheryl Gay Stolberg and Rebecca Robbins reported this week at [The New York Times](. They explained: âIf the three agency scientists are named on the patent along with the Moderna employees, the federal government could have more of a say in which companies manufacture the vaccine, which in turn could influence which countries get access. It would also secure a nearly unfettered right to license the technology, which could bring millions into the federal treasury. âThe fight comes amid mounting frustration in the U.S. government and elsewhere with Modernaâs limited efforts to get its vaccine to poorer countries. The company, which has not previously brought a product to market, received nearly $10 billion in taxpayer funding to develop the vaccine, test it and provide doses to the federal government. It has already lined up supply deals worth about $35 billion through the end of 2022.â Dr. Francis Collins, the NIH director, told [Reuters]( on Wednesday that scientists at the agencyâs Vaccine Research Center played "a major role" in developing the vaccine and said that the government would defend its claim to a share of the patent. "I think Moderna has made a serious mistake here in not providing the kind of co-inventorship credit to people who played a major role in the development of the vaccine that they're now making a fair amount of money off of," Collins said. He added that the federal collaboration with Moderna had been friendly for years, but that efforts to resolve the patent issue amicably had failed. "But we are not done,â he said. âClearly this is something that legal authorities are going to have to figure out.â Moderna reportedly expects sales of its Covid-19 vaccine to total $15 billion to $18 billion this year and up to $22 billion next year. âSales of its vaccine both this year and next are likely to rank among the highest in a single year for any medical product in history,â the Times said. Send your feedback to yrosenberg@thefiscaltimes.com. And please tell your friends they can [sign up here]( for their own copy of this newsletter. News - [Biden Got His Infrastructure Bill. Now He Has to Sell It to Voters.]( â New York Times
- [The White House Says Its Plans Will Slow Inflation. The Big Question Is: When?]( â New York Times
- [Explainer: Why US Inflation Is So High, and When It May Ease]( â Associated Press
- [Economist Larry Summers Says White House Misread Inflation]( â The Hill
- [Is the West Wing Out of Touch? Corporate Execs Call on White House to Fight Inflation.]( â Politico
- [Biden Hopes to Turn Infrastructure Bill Into Jobs Quickly]( â The Hill
- [A $124B Tax Increase? Wall Street Shrugs.]( â Politico
- [Critics Say Congress Falling Short on Pandemic Preparedness]( â The Hill
- [The N.I.H. Says It Isnât Giving Up in Its Patent Fight With Moderna]( â New York Times
- [Hospitals in Western U.S. Under Siege as Covid-19 Packs ICUs]( â Bloomberg
- [What We Know So Far About Waning Vaccine Effectiveness]( â New York Times
- [Biden Called for Widespread Mandates. His VA Is Navigating Its Own Minefields.]( â Politico Views and Analysis - [The Shadow of Ronald Reagan Is Costing Us Dearly]( â Claire Bond Potter, New York Times
- [Biden's âI Feel Your Painâ Conundrum]( â Christopher Cadelago and Eugene Daniels, Politico
- [Deck the Halls With Infrastructure]( â Gail Collins, New York Times
- [Why Inflation Is a Political Nightmare for Biden]( â Stephen Collinson, CNN
- [Biden Says He Takes Inflation Seriously. Heâs Not Acting Like It.]( â Rich Lowry, Politico
- [What Can Joe Biden Do About Inflation, Really?]( â Mark Gongloff, Bloomberg
- [Biden Is Botching Inflation Jawboning]( â Jonathan Bernstein, Bloomberg
- [Bidenâs Infrastructure Bill Will Lift Up China Inc.]( â Anjani Trivedi, Bloomberg
- [âWe Donât Fix This Because We Just Donât Care About Old Peopleâ]( â Joanne Kenen, Politico
- [The Reconciliation Bill Is a Much-Needed Opportunity to Invest in Prevention]( â John K. Roman and Diana Fishbein, The Hill Copyright © 2020 The Fiscal Times, All rights reserved.
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