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Joe Manchin could agree to a Build Back Better that keeps most of the Trump tax cuts

Business Insider logo Business Insider 5/27/2022 insider@insider.com (Juliana Kaplan,Joseph Zeballos-Roig)
Joe Manchin (D-WV) talks on the phone outside of a lunch meeting with Senate Democrats at the U.S. Capitol November 16, 2021 in Washington, DC. Drew Angerer/Getty Images © Provided by Business Insider Joe Manchin (D-WV) talks on the phone outside of a lunch meeting with Senate Democrats at the U.S. Capitol November 16, 2021 in Washington, DC. Drew Angerer/Getty Images
  • Sen. Joe Manchin has once again expressed a willingness to discuss a reconciliation package.
  • He told Axios his talks with Senate majority leader Chuck Schumer have been "encouraging."
  • Manchin also seemed willing to compromise on hiking taxes, something that could win over Sen. Kyrsten Sinema.

For over a year, Democrats have feuded over President Joe Biden's proposed social and climate spending package. 

At the center of the debate stands two centrists: Sens. Joe Manchin and Kyrsten Sinema, who have both shot down swaths of the Build Back Better plan, ranging from aggressive prescription drug price controls to monthly checks to parents.

In a fresh glimmer of hope, Manchin is hinting that the package he once pronounced "dead" might Frankenstein its way into existence via reconciliation — with a few major chunks taken out of it. 

The conservative Democrat told Axios that his recent talks with Senate majority leader Chuck Schumer about a package on climate and deficit have been "encouraging, to a certain extent."

Manchin has previously supported some of Biden's proposals to hike taxes, including an increase to the corporate tax rate. He told Axios that he'd still like to see the corporate rate rise to 25%. Biden initially proposed 28%. Instead, per Axios, Manchin will "settle" for a domestic minimum rate of 15%, a proposal that Sinema previously backed.

A key hurdle to Manchin's chief tax goal is Sinema. She is adamantly opposed to increasing tax rates on the rich and large corporations, all but undoing a Democratic effort to roll back the Trump tax cuts. In February, Manchin said he wanted Sinema to take another look at potential hikes, but she didn't seem to budge. Sinema said in April that her demands for a package had not changed. 


Video: Psaki addresses Manchin's comments about Build Back Better revival (Daily Mail)

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Manchin's comments indicate that the two could strike a deal and potentially move a spending package forward, but at the expense of keeping many Trump-era tax cuts in place.

Manchin reiterated his support to unwind the law at the World Economic Forum at Davos, Switzerland on Monday."What we need is a competitive tax code that spins off enough for us in the United States to take care of ourselves, pay down our debt, and live within our means," he said.

Schumer and Manchin have huddled three times in Schumer's office over the past month in what resembles a conclave carrying enormous consequences for President Joe Biden's economic agenda heading into the November midterms.

Manchin has voiced support for a smaller bill focused on reducing the federal deficit, cutting prescription drug prices, and stepping up taxes on the wealthiest Americans and large firms.

Many Democrats believe that the start of the August recess represents the deadline for the party to get a skinnier climate and tax bill to Biden's desk. 

Still, that hasn't kept some from floating an even later deadline to lock in swaths of Biden's agenda. "Sept. 30, for sure, because that's when the reconciliation measure expires, and likely before the August recess," Sen. Sheldon Whitehouse of Rhode Island told The Washington Post.

However, there is still the possibility that Manchin could sink a package yet again.

"There could be nothing. There could be truly nothing," he told Axios. "That's all I can tell you."

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