There's a reason voters are hearing more about the child tax credit during this presidential campaign, with both Republican and Democratic candidates voicing support for its expansion.
Giving families with children a tax break is a popular and effective policy that reduces poverty and helps parents afford basic needs like food and child care. The child tax credit is currently capped at $2,000 per year per child and is set to expire in 2025.
Vice President Kamala Harris wants to restore it The administration could increase the child tax credit to its pandemic-era level of up to $3,600 per child and add an additional $6,000 credit for families with newborns. Former President Trump has offered only vague comments of support for the child tax credit, though his vice presidential running mate, Ohio Sen. J.D. Vance, has said he wants to increase it to $5,000.
But we don’t put much stock in Republicans’ promises to fight for working families. Vance, who has hypocritically tried to label Democrats “anti-family and anti-child,” didn’t even show up to vote for a modest expansion of the child tax credit that his fellow Senate Republicans rejected on Aug. 1. And Trump, whose tax policies while in office largely favored the wealthy, is an inveterate liar who will say almost anything to regain power.
That's a shame, because whoever controls the White House next year should press ahead with a permanent expansion of a policy that has been proven to ease financial strain on families and lift children out of poverty.
The child tax credit was first enacted in 1997 under President Clinton and has been expanded several times by Democratic and Republican presidents. But the most dramatic improvement came under President Biden with his signing of the 2021 American Rescue Plan. The law, which received no Republican votes, increased the child tax credit, made it fully refundable, paid it in monthly deposits of up to $300 per child into families’ bank accounts, and extended full benefits to low-income children who had previously received less because their families earned too little.
According to researchers, these improvements brought immediate, life-changing benefits. Childhood poverty and food insecurity fell dramatically. Families reported feeling less stressed about money, and their checking account balances increased. Monthly deposits provided a predictable source of income for nearly 40 million families and left it up to parents to decide how best to use the money. Researchers at Columbia University’s Center on Poverty and Social Policy found that they spent it mostly on essentials like food, child care and housing.
But Congress allowed it to expire after six months, and Republicans have since blocked attempts to extend or restore it. How un-family-friendly!
It’s encouraging that Harris has made Biden’s revival and expansion of the pandemic-era child tax credit one of her first major economic policy proposals, presenting it as a major financial relief for middle- and working-class families. Her running mate, Minnesota Gov. Tim Walz, has offered similar benefits for his state’s families through a generous $1,750 child tax credit that took effect last year.
Vance’s interest in expanding the child tax credit appears motivated by an entirely different philosophy, including his fringe views on the role of women in society, his pronatalist fascination with increasing the country’s birth rate, and his outlandish suggestion of giving parents with young children extra votes and reducing the electoral power of childless people. In addition to increasing the child tax credit, Vance wants to extend the benefits to wealthier families. It’s another reflection of a Republican Party that is always looking out for the rich.
For example, it's true that Trump increased the child tax credit from $1,000 to $2,000 as part of his 2017 tax cuts that lowered tax rates for the wealthy and corporations, but it was structured in such a way that most of the benefits went to high-income families.
A married couple earning $400,000 with two children got a new $4,000 tax cut, while a single parent with two children earning the minimum wage saw his tax cut increase by just $75. That’s because the full tax credit was extended to higher-income families but not made fully refundable, leaving poor families who don’t owe much income tax with only a token bump, according to an analysis by the Center on Budget and Policy Priorities think tank.
Families deserve more support when rising prices for housing, food and other essential goods are causing widespread financial insecurity. Strengthening the child tax credit is an effective and proven solution.
It's a good sign that both Republican and Democratic candidates are talking about doing more to help families with children. The well-being of children is in the best interest of all of society and shouldn't be a partisan issue. But we believe that campaign promises are more compelling when they come from candidates with a track record to back them up. And when politicians claim to be pro-family, don't just listen to what they say, watch what they do.
