With the parties split 50-50 in the Senate, Vice President-elect Kamala Harris will break ties, allowing major priorities like stimulus, climate change, and health care, potentially paid for with tax increases, to be brought up and passed in the House and Senate. Because the margin is so narrow, Democrats will need to negotiate with Senate Republicans, use the budget reconciliation process or change the rules regarding the filibuster to pass legislation. Regardless of how legislation is processed, moderate senators will play a huge role in deal-making.
The first bill sought by Democrats is likely to be pandemic relief and health care changes. Beyond stimulus, the President-elect Biden/Democratic policy agenda has tax increases as a common thread. Plans on health care, climate change, education, housing and other areas envision tax changes like rolling back parts of the Tax Cuts and Jobs Act (TCJA) and otherwise turning tax rate dials. Those hikes could be used to fit a bill within whatever revenue constraints Democrats decide. The tax increases supported by Biden during the campaign will likely not be in initial stimulus legislation, but may be used to offset the cost of changes in permanent policies for major priorities like climate change, health care, education and housing.
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