2023-06-10 20:37:24
An analysis from the Center on Budget and Policy Priorities (CBPP) released this week finds that when the temporary expansion of the Child Tax Credit expired at the end of 2021, the credit reverted to the flawed design left behind by the law. of the previous government, dating from 2017.
As a result, the study notes, about 7 million Hispanic children will receive less than the full child tax credit, or no credit, this year because their families earn so little, while families with much higher incomes (up to $400,000 for couples married) will receive the full credit of $2,000 for each child.
The CBPP report, based on state data, explains the well-founded reasons why expanding credit for these children “should be the top priority for tax legislation that Republicans on the House Ways and Means Committee are making.” preparing”.
“Congress – the document specifies – must ensure that a solid expansion that helps children from low-income families to see their basic needs covered, occurs before the corporate tax breaks that House Republicans are likely to propose short term.
The CBPP highlights that the temporary expansion of the Child Tax Credit in the American Rescue Plan “was an amazing success.”
- The expansion reduced child poverty in 2021 to record lows.
- It also reduced the differences in poverty rates between children of different races and ethnicities.
- The vast majority of low-income families spent their monthly Child Tax Credit payments on basic needs and educational expenses.
- As if that weren’t enough, parents continued to re-enter the workforce and take jobs while the expanded Child Tax Credit was in effect.
The CBPP report recommends taking steps to ensure that low-income children get the same benefit as those from higher-income families, because doing so “would have a modest cost, which is much less than the combined cost of tax breaks that the corporate lobbyists are pushing.”
Such exemptions include:
- Restore the more generous tax treatment of research and experimentation (R&E) spending, which will cost $150 billion over ten years;
- Delay phasing out aggressive deductions for business plant and equipment costs ($325 billion cost over ten years); and,
- Loosen a cap on the amount of interest certain companies can deduct (cost $20 billion per year).
In this regard, CBPP’s analysis finds that corporate tax cuts are regressive, flow disproportionately to the wealthiest and foreign shareholders, and have a long history of “not trickling down.”
“Therefore – he points out – a tax package that serves corporate interests and leaves families behind should be unacceptable.”
“All children should have the opportunity to prosper, and the expansion of the Child Tax Credit would take an important step in that direction,” the center’s report concludes.
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