A bipartisan group of 10 senators wants to use unspent COVID-19 relief money and new taxes on electric vehicles as two of the main ways to pay for its $1.2 trillion eight-year infrastructure plan, the senator said. Susan Collins from Maine on Sunday. .
The group outlined its plan on Thursday, but provided some details. That would include $579 billion in new spending but limit it to basic infrastructure like roads, bridges and broadband, leaving aside social programs and a corporate tax increase favored by President Joe Biden.
It is the latest in a series of attempts to break an impasse on the issue between the White House and the Republicans. Biden interrupt negotiations with Senate Republicans last week, but the new bipartisan group quickly slipped out of the margins of that deal. A group of 58 members of the Chamber equally divided between the parties has submitted its own $1.25 trillion proposal.
Collins, a republican, said CBS’s “Face the Nation” on Sunday that the group has coalesced behind three financing methods: unused stimulus money, a user fee for electric vehicles that pay no gas tax, and a financing model similar to that used for sewage and water infrastructure.
The Maine senator seemed to reject the idea of pegging the gasoline tax to inflation. The tax itself has not increased since 1993. Indexing was suggested by Senator Mitt Romney, R-Utah, and some Democrats are open to it. But Biden rejected the idea of raising taxes on Americans earning less than $400,000 a year, which could also doom the electric vehicle tax.
“There will not be a gas tax increase and we will not be undoing the 2017 tax reform bill,” Collins said, referring to your party’s tax break package.
It is unclear whether this proposal will gain more traction than others that have failed so far, although it has gone beyond those proposals with five Democrats in the group, including Sens. Joe Manchin of West Virginia and Kyrsten Sinema of Arizona, who are moderate undecided voters in the 50-50 House.
The tricky part is paying for this plan in a way that satisfies everyone. Biden, who cut his initial proposal from a staggering $2.2 trillion to $1.7 trillion it prefers higher corporate taxes over user fees, such as higher gas and toll taxes, which business groups have long advocated. US Representative Jared Golden from the 2nd District of Maine pointed to increased IRS inspection as a potential way to fund infrastructure last week.
White House officials met Thursday with Democratic senators working on a bipartisan agreement. “There are still some questions that still need to be answered, particularly regarding the details of policy and payments,” said White House spokesman Andrew Bates.
Cabinet members and senior White House officials “will work with the Senate group to answer these questions as we consult with other members in the House and Senate,” said Bates.
Bloomberg News editor Erik Wasson contributed to this report.