Treasury Secretary Janet Yellen will make a series of speeches in the coming weeks to highlight the various tax provisions in the recently enacted Inflation Reduction Act.
According to a Treasury official, the speaking tour is part of a push by the department to explain the significance of President Biden’s economic agenda ahead of the fall midterm elections.
Yellen will start with a visit to Detroit on September 8, where she will highlight how electric vehicle tax credits in the Inflation Reduction Act (P.L. 117-169), along with tax credits for semiconductor production in the CHIPS and Science Act of 2022 (P.L. 117-167), will benefit the automotive industry.
The following week, Yellen will be in the Washington area, arguing that new resources for the IRS and the introduction of a corporate minimum tax will raise revenues and increase fairness in the tax code.
Under the Inflation Reduction Act, the IRS is set to receive $80 billion in additional funding, which it intends to use to improve its outdated technology and go after high-income tax dodgers. Meanwhile, the Biden administration and congressional Democrats say the introduction of a 15 percent corporate minimum tax rate on companies with $1 billion or more in annual revenue will prevent large U.S. multinationals from using loopholes to pay little to no federal taxes.
Later in September, Yellen will travel to North Carolina, where she plans to promote the climate change provisions in the new legislation, including tax credits for clean energy technology.
Under the law, there is a clean electricity investment credit worth about $51 billion, as well as an $11 billion clean electricity production credit that is meant to enhance development of wind, solar, hydropower, and other technologies.
To round things off, Yellen will deliver remarks at the annual Freedman’s Bank Forum, where she will focus on the administration’s efforts to address inequity in the tax code and the economy as a whole.
Biden signed an executive order on his first day in office calling for a “whole-of-government” approach to combating racial inequities, but questions remain about the measures Treasury plans to take, including the potential collection of statistics based on ethnicity.
As Yellen hits the road to promote the new tax provisions, the outlook for another of the administration’s signature tax proposals remains murky.
Despite repeated calls from Yellen for Congress to adopt the OECD-brokered global corporate minimum tax, passage of the measure will take a back seat with the midterm elections approaching. While the OECD’s minimum tax also stipulates a 15 percent rate similar to the corporate minimum tax in the Inflation Reduction Act, there are key differences in its application.