U.S. Treasury Secretary Janet Yellen has issued a strong warning against eliminating the clean energy tax credits provided by the Inflation Reduction Act (IRA). She calls this move a “historic mistake,” emphasizing that it would have significant negative consequences for American families and the nation’s manufacturing sector.
Yellen argues that reversing these tax credits would lead to increased costs for families, particularly at a time when efforts to lower prices are crucial. Additionally, she asserts that such a move would threaten the significant investments being made in U.S. manufacturing, jeopardizing the creation of jobs, many of which do not require a college degree.
She highlights the potential for China to gain an advantage in the green energy industry if the U.S. rolls back its clean energy incentives. Yellen emphasizes that families across the country have already claimed $8.4 billion in energy tax credits, which will contribute to reducing their long-term energy bills.
These statements come in response to proposals from former President Donald Trump, who has advocated for reallocating funds from environmental projects to infrastructure projects like roads, bridges, and dams. He has dismissed the Inflation Reduction Act’s focus on clean energy as a “Green New Scam.” Trump has also pledged to cut American energy costs by half or more, a promise that experts are scrutinizing due to the complexities of global and regional energy markets.
In a separate development, Vice President Kamala Harris introduced a 28% tax on long-term capital gains for households earning $1 million or more annually, representing a softening of the Biden administration’s previously proposed rates ahead of the 2024 presidential election. This move aims to address concerns about economic inequality and raise revenue for government initiatives.
Amidst these political developments, Bank of America Corporation is reportedly planning to invest $205 million in exchange for tax credits from an ethanol producer, Harvestone Low Carbon Partners, which captures carbon at a plant in North Dakota. This investment highlights the growing focus on sustainability and carbon capture technologies within the private sector.
