Biden's $1.75 trillion spending bill delivers special tax breaks for union allies

Labor organizations contributed $27.5 million to the Biden campaign and outside groups supporting him, according to Open Secrets.

By Nicholas Ballasy

Published: November 18, 2021 11:33am

Updated: November 21, 2021 11:55pm

The revised version of President Biden's nearly $2 trillion spending bill includes an approximately $1.8 billion tax break for labor unions.

Labor organizations contributed $27.5 million to President Biden's campaign and outside groups supporting him, according to Open Secrets.

The tax reform law that former President Trump signed in 2017 did not allow individuals to deduct labor union dues. The Democrats' Build Back Better Act reverses that move and allows individuals to deduct labor union dues up to $250 annually at an estimated cost of about $1.8 billion over 10 years, according to an analysis from The Joint Committee on Taxation.

JCT Build Back Better Act.pdf

The Build Back Better Act also includes a special $4,500 federal tax credit for union-made electric vehicles. It would be issued on top of a $7,500 federal credit on electric vehicle purchases. Non-union manufacturers such as Honda, Toyota and Tesla oppose the special $4,500 credit.

"What does this say to the American autoworker who has decided not to join a union?" asked a recent Toyota ad against the proposal. "It says that their work is worth $4,500 less because they made that choice. What does this say to the American consumer? It says that if they want to buy an electric vehicle not made by Ford, General Motors or Chrysler, they will have to pay an extra $4,500 — which is about $100 more per month over a four-year period."

Biden's $1.9 trillion American Rescue Plan included a massive $86 billion bailout for union-managed pension plans.

Biden promised that his $1.2 trillion infrastructure bill would create more union jobs. Labor union bosses such as Teamsters President James P. Hoffa attended the bill signing, and a labor representative delivered remarks at the ceremony.

The latest U.S. Bureau of Labor Statistics data shows that the "number of wage and salary workers belonging to unions" was 14.3 million in 2020. The BLS has reported that union members made up about 10.8% of the entire U.S. workforce in 2020.