WASHINGTON — A provision regarding state taxes in the COVID relief package passed by Congress earlier this month has caught the eye of one of your senators in Washington.
Sen. Mike Braun (R-IN) is referring to a provision written by Sen. Joe Manchin (D-WV) that puts essentially attaches a string to the nearly $350 billion in federal relief that all 50 states, as well as U.S. territories, will be splitting up among them.
“There was a small fine print. My team caught it,” Braun said to Fox Business. “(It says) that you cannot use that money if you lower taxes in your state. That shows you how far the Democrats will go to put that type of restriction on good business climate states, like Indiana.”
More specifically, the provision states that a state cannot accept federal relief money from the American Rescue Plan Act in order to offset losses in revenue, either directly or indirectly, from tax cuts passed by that state’s legislature. That essentially bans states on taking any legislative action to lower taxes until 2024.
“The Joe Manchin amendment says you can’t do it,” said Braun. “It’s probably unconstitutional. That’s one of many things you get when you look at a bill full of many things that you don’t need.”
Many other critics of the provision say that it violates the Tenth Amendment of the U.S. Constitution. Braun has introduced a bill in the Senate that would repeal this provision.