How the Inflation Reduction Act Will Benefit American Families
Throughout the summer, as Americans dealt with high levels of inflation, Christians continued to hold true to their faith and trust in positive change. In August, we got some relief as Congress passed the Inflation Reduction Act to reduce the federal deficit by $300 billion, lower the costs of healthcare, fight for a cleaner Earth, and curb inflation.
For the majority of Americans, the Inflation Reduction Act (IRA) will enact crucial changes to help Americans and their communities bounce back from this challenging period. The IRA has a number of broad provisions that will positively impact millions of American families. Here are some of those benefits:
Health Care Benefits
As Christians, we have an imperative to look out for one another and to heal those suffering from sickness. The IRA includes a number of plans to heal the sick and provide Americans with better healthcare opportunities.
One key provision of the IRA is that it allows Medicare to negotiate with drug companies directly over prices, which has been prohibited for almost 20 years. Currently, Americans pay two to three times more for drugs than people in other wealthy countries. Giving Medicare the power to negotiate prices will lead to lower prices for medicine, protecting the livelihoods of Americans nationwide. Additionally, the IRA prevents drug companies from increasing Medicare prices above the rate of inflation, ensuring that Americans are able to get reasonable prices that they can afford.
Further, the IRA caps out-of-pocket prescription drug costs for seniors at $2,000 annually. This is expected to save 1 million American seniors around $1,000 annually. It will also ensure that Medicare beneficiaries must pay no more than $35 out of pocket monthly for insulin, a life-saving drug for millions of Americans living with diabetes.
The IRA also prevents higher health care costs by extending enhanced Affordable Care Act marketplace subsidies through 2025, which will save the average enrollee around $800 annually.
Lower Energy Costs
Fossil fuel prices are one of the main causes and hardest hit areas of inflation, evidenced by high gas prices in recent months. To both lower the costs of fossil fuels and to spur a shift to more sustainable energy, the IRA emphasizes ways to lower energy costs for electricity and natural gas sources for American families.
As part of this, the IRA works to expand and bolster the clean energy manufacturing economy, which will create millions of jobs for Americans.
One way in which the IRA will lower costs is by providing middle and working class Americans with tax credits if they purchase electric vehicles made in America.
Further, the act includes $80 in discounts to help households pay for cleaner energy upgrades. Subsidies cover improvements such as efficient heat pumps, electric water heaters, electric cooktops, solar panels, and more. Using these subsidies to switch to cleaner technology is estimated to save households as much as $1,840 annually on energy bills.
Not only will these provisions help Americans save money, but they will also help end American dependence on energy sources that harm the beautiful Earth God entrusted us to protect.
Building a Better and More Fair Tax Code
In addition to providing better health coverage for millions of Americans, lowering energy costs, and making strides to protect God’s creation, the IRA also focuses on building and enforcing taxes in a fairer and more equitable way.
The IRA includes a 15% minimum tax for many corporations with over $1 billion in annual profits, in addition to a 1% tax on corporations that transfer their revenue to shareholders, rather than invest in their business or employees.
In 2019, only 2% of U.S. households earning $5 million or more annually were audited, compared to over 16% in 2010. Funding in the IRA will be allocated to better enforcement of taxes to ensure that the wealthy pay their share.
However, for the majority of Americans increased IRS funding will ensure that they receive tax refunds faster and can file their taxes with the IRS directly for free.
Overall, the Inflation Reduction Act will play a crucial role in protecting the lives of Americans nationwide, safeguarding God’s wondrous Earth, and will fight inflation and drive down the national deficit.
While we have been tested with difficulties in recent months, we are blessed to live in a country with an abundance of opportunities and support. As we progress out of this tough economic time, let us continue to have faith in America and in each other.