Yellen Says Manchin Bill Won’t Raise Taxes for Families Earning Less Than $400,000 a Year

Christopher Condon
Tue, August 2, 2022 



(Bloomberg) -- Treasury Secretary Janet Yellen waded into the congressional debate over proposed economic and climate legislation, saying it won’t raise taxes for families earning less than $400,000 a year.

“The legislation would either reduce or have no effect on the taxes due or paid by any family with income less than $400,000,” Yellen wrote Tuesday in a letter to House Speaker Nancy Pelosi obtained by Bloomberg News. “In fact, the clean energy tax credits and the expanded premium tax credit will cut taxes for millions of Americans.”

Yellen wrote to Pelosi after an analysis by the Joint Committee on Taxation, an official congressional scorekeeper, found that some middle- and low-income households could pay additional taxes next year under the bill, unveiled last week between West Virginia Senator Joe Manchin and Senate Majority Leader Chuck Schumer.

The $400,000 income threshold is crucial for the White House, as President Joe Biden promised during his election campaign not to raise taxes for households below that line. While Democrats have disputed the estimates, Republicans have used the JCT figures to amplify their opposition to the bill.

In her letter, Yellen didn’t respond directly to the JCT’s analysis on the distributional effects of the bill’s tax changes. Instead, she reviewed each of the legislation’s major components and said the tax changes would only affect “large corporations and investment professionals making $400,000 or more per year.”