Federal Credit for Infrastructure Bonds: Government Pays 28% of Interest.
This Act creates a new financing tool called "American Infrastructure Bonds" to fund public projects by state and local governments. The federal government will directly pay the issuer 28% of the interest due on these bonds, significantly lowering borrowing costs for infrastructure development. However, investors purchasing these specific bonds must include the interest earned in their federal taxable income.
Key points
The federal government subsidizes infrastructure projects by covering 28% of the interest payments made by state and local governments on new bonds.
Investors who purchase these new infrastructure bonds must pay federal income tax on the interest they receive, unlike traditional tax-exempt municipal bonds.
The measure aims to accelerate public works projects (like roads and schools) by making financing cheaper for local authorities.
Status:
Introduced
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