Lobbyists are lining up to push Congress to approve more corporate tax breaks before Jan. 1, including extending deductions for research and development. Supporters argue that U.S. businesses need such incentives to keep the nation competitive in the world economy.
But nothing boosts the nation’s ability to compete as much as a direct investment in the health and security of its children. As members of Congress negotiate a year-end budget package, they should not approve more incentives for big business, without also extending an expanded Child Tax Credit.
Pennsylvania’s Congressional delegation — including U.S. Sens. Pat Toomey, a Republican, and Bob Casey Jr., a Democrat; as well as U.S. Rep. Mike Doyle, an Allegheny County Democrat — ought to make sure an extension of the expanded Child Tax Credit becomes part of any bipartisan year-end budget package. Ideally, Congress should make the expanded CTC permanent. At minimum, Congress should extend it for two years, and make it retroactive for this year.
No federal program has been more effective. The expanded CTC benefited 60 million children and helped reduce U.S. child poverty rates by 46%, said Ken Patterson of RESULTS, an anti-poverty advocacy group. Not surprisingly, Columbia University researchers found a 41% increase in child poverty, after expanded monthly Child Tax Credits stopped in January.
In Pennsylvania, the program helped an estimated 1.4 million families with 2.4 million children. Children in the poorest of those families face hunger, instability and prospects nearly as dim as those of the displaced children of Ukraine. Middle- and working-class families also received the expanded CTC; in fact, they received most of the benefits.
Under last year’s American Rescue Plan, the maximum Child Tax Credit increased to $3,000, or $250 a month, for each child aged 6 to 17; and to $3,600, or $300 a month, for younger children. More than 90% of all families with children received an average benefit of $4,380, reports the Tax Policy Center. The CTC became the largest federal cash-support program for children in 2021. Monthly installments enabled families to budget for food, utility and housing costs. Some families opened their first bank account.
The former child tax credit program left out millions of poor children whose families did not earn enough to qualify. By making the CTC fully refundable, low-income families received the full benefit.
Expanded monthly CTC payments, however, applied only to 2021. (Families who didn’t file taxes for 2021 can still claim a full Child Tax Credit for last year.) Shamefully, the U.S. Senate failed to renew the CTC expansion for 2022, tossing nearly 4 million children back into poverty.
Owing to congressional inaction, 19 million children in the lowest income families no longer get the full value of the CTC, said Meredith Dodson of RESULTS. Galloping inflation rates of roughly 9% this year worsened the economic plight of children and families.
Any version of the Child Tax Credit approved before Jan. 1 should not include work requirements. Work requirements sound reasonable, but they withhold money from the children who most need it and aggravate racial disparities. They also fail to account for circumstances common in poor families, such as children living with retired grandparents; and interfere with education and training that are essential to making families self-sufficient.
Extending an expanded Child Tax Credit this year is a moral, social and economic imperative. Historically, nearly 20% of U.S. children live in poverty, a figure close to Mexico’s rate, reports the international Organization for Economic Development. The attendant impacts of poverty on a child’s development, health and safety are formidable: They influence how the body and mind develop, widen academic achievement gaps, undermine health, reduce access to educational resources, and put children in proximity to crime, violence and environmental toxins.
Extending the expanded Child Tax Credit would alleviate all of those problems for the key to the nation’s future — its children. Shame on members of Congress if they adjourn for the holidays without first taking care of their most important priority.
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