(NEXSTAR) — House Democrats unveiled a sweeping proposal Monday for tax hikes on big corporations and the wealthy to fund President Joe Biden’s $3.5 trillion rebuilding plan, as Congress speeds ahead to shape the far-reaching package that touches almost all aspects of domestic life. Sen. Joe Manchin (D-W. Va.) made it clear over the weekend, however, that he would not support the plan’s price tag and suggested new eligibility requirements for the expanded child tax credit.
“I support child tax credits. I sure am trying to help children,” Manchin said Sunday during an interview with CNN’s Dana Bach on “State of the Union.”
The Democratic senator, whose vote is vital to the bill’s passage, said he was hesitant about making the tax credits permanent.
“You want to help the children and the parents that are basically providing for those children,” Manchin said. “There’s no work requirements whatsoever. There’s no education requirements whatsoever for better skill sets. Don’t you think, if we’re going to help the children, that the people should make some effort?”
Manchin added that the cost of the full package will need to be slashed to $1 trillion to $1.5 trillion to win his support.
He also cautioned there was “no way” Congress will meet the late September goal from House Speaker Nancy Pelosi, D-Calif., for passage given his current wide differences with liberal Democrats on how much to spend and how to pay for it.
“I cannot support $3.5 trillion,” Manchin said Sunday, citing in particular his opposition to a proposed increase in the corporate tax rate from 21% to 28% and vast new social spending. “We don’t have the need to rush into this.”
But Sen. Bernie Sanders, the Vermont independent who chairs the Senate Budget Committee and is helping craft the measure, noted that he and other members of the liberal flank in Congress had initially urged an even more robust package of $6 trillion.
“I don’t think it’s acceptable to the president, to the American people or to the overwhelming majority of the people in the Democratic caucus,” Sanders said. He added: “I believe we’re going to all sit down and work together and come up with a $3.5 trillion reconciliation bill which deals with the enormously unmet needs of working families.”
The current blueprint proposes billions for rebuilding infrastructure, tackling climate change and expanding or introducing a range of services, from free prekindergarten to dental, vision and hearing aid care for older people.
Manchin voted last month to approve a budget resolution that set the figure, though he and Sen. Kyrsten Sinema, D-Ariz., have expressed reservations about the topline amount. All of it would be paid for with taxes on corporations and the wealthy.
The proposed top tax rate would revert to 39.6% on couples earning more than $450,000, and there would be a 3% tax on wealthier Americans making beyond $5 million a year. For big businesses, the proposal would lift the 21% corporate tax rate to 26.5% on incomes beyond $5 million.
In all, the tax hikes are in line with Biden’s own proposals and would bring about the most substantive changes in the tax code since Republicans with then-President Donald Trump slashed taxes in 2017. Business and anti-tax groups are sure to object. But Democrats are pressing forward.
Rep. Richard Neal, D-Mass., the chairman of the tax-writing Ways & Means Committee, said taken together, the proposals would “expand opportunity for the American people and support our efforts to build a healthier, more prosperous future.”
Republicans in the Ways & Means Committee, however, issued a statement last week calling the expanded child tax credit “welfare without work” and claiming that if made permanent it “will harm families, risk the loss of billions of taxpayer dollars in waste and fraud, and cost American jobs.”
Manchin, who in an op-ed earlier this month urged a “strategic pause” on the legislation to reconsider the cost, described the timing as unrealistic. He has urged Congress to act first on the $1 trillion bipartisan infrastructure bill already passed by the Senate. But liberal Democrats have threatened to withhold their support until the $3.5 trillion spending bill is passed alongside it.
In a preliminary estimate, the proposed tax hikes were found to raise an estimated $2.9 trillion, covering a substantial amount of the price tag. The remainder is projected to come from $600 billion generated through long term economic growth sparked by the sweeping plan.
Manchin spoke on CNN’s “State of the Union,” NBC’s “Meet the Press” and ABC’s “This Week.” Sanders was on CNN and ABC.
The Associated Press contributed to this report.