Some economic justice groups this week are pushing for the passage of a $78 billion bipartisan tax package that includes an expansion of the child tax credit—but one lawmaker who has made the credit one of her signature issues for years said Monday that the legislation does not go far enough to support families in need, especially considering the corporate tax breaks it includes.
As U.S. House Speaker Mike Johnson (R-La.) said the bill is expected to come to the House floor this week under "suspension of the rules," an expedited maneuver requiring the approval of two-thirds of members for passage, U.S. Rep. Rosa DeLauro (D-Conn.) said the bill "fails on equity" and leaves out too many struggling American families.
DeLauro released a fact sheet showing how the bill, negotiated by Rep. Jason Smith (R-Mo.) and Sen. Ron Wyden (D-Ore.), "falls far short of comparing to the gains made under the American Rescue Plan (ARP)," which in 2021 helped slash childhood poverty by about 30% with its inclusion of an enhanced child tax credit (CTC).
With Republicans insisting on work and minimum income requirements for the version of the CTC included in the tax package—to "safeguard" against undocumented immigrants and "ineligible persons" benefiting from the bill, according to the House Ways and Means Committee—"families with little-to-no income are left behind from the full child tax credit, while allowing a single parent making $200,000 or a married couple making $400,000 to receive the full $2,000 credit," notes DeLauro's fact sheet.
The ARP included all but the highest earners in the enhanced CTC, which increased the maximum credit amount to $3,000-$3,600 per child depending on the child's age and issued half of the credit on a monthly basis, enabling families to use the money for everyday necessities.
Falling short of the credit amount included in the ARP, the Wyden-Smith plan would afford families a maximum of $2,100 per child and would not provide payments to families on a monthly basis.
The tax deal is estimated to lift "up to 400,000 kids" out of poverty, said DeLauro, while "93% of kids in the lowest quintile (the poorest 1/5th of children in the country) will continue to be left behind—meaning they will not receive the full credit."
Last week DeLauro called on her fellow Democrats to "fight to ensure our families aren't sold out for profits" and told The Connecticut Mirror the bill has "serious room for improvement."
While falling short on providing economic support for families paying for groceries, childcare, healthcare, and other essentials, the Wyden-Smith deal "locks in $600 billion in tax cuts for businesses," according to Smith.
The GOP aims to make those cuts permanent, making the three-year cost "four times higher than the child tax credit," DeLauro noted.
"This is not parity," said the congresswoman, adding that a research and development tax credit for corporations will be made retroactive "under the guise of incentivizing R&D."
"It is virtually impossible to incentivize action for anything retroactively," said DeLauro. "While the CTC phases-in, corporations will
get their tax cuts on the first dollar. Families will not be getting any additional child tax credit retroactively to 2022, like the corporations are."
The tax deal "delivers huge tax cuts for giant corporations while denying middle-class families the economic security they had under the expanded, monthly child tax credit," said DeLauro. "It also leaves the poorest families behind because of a policy choice. At a time when a majority of American voters believe tax on big corporations should be increased, there is no reason we should be providing corporations a tax cut while only giving families pennies."
The Pew Research Center found last year that 61% of Americans feel corporations don't pay their fair share. Nearly two-thirds said tax rates on large corporations should be raised; 39% said by "a lot," while 26% said by "a little" and just 14% said they should be lowered.
Some of DeLauro's colleagues have suggested any expansion of the CTC should be passed, with Sen. Richard Blumenthal (D-Conn.) tellingThe Mirror he was "less than ecstatic" that the credit is not completely expanded but that he would "rather see this provision enacted than none at all."
Another Connecticut Democrat, Sen. Chris Murphy, said he would consult "the mother of the child tax credit"—DeLauro.
"I'm going to continue to work to improve this legislation before it's considered on the House floor because I believe that families and children need a strong child tax credit," DeLauro told the outlet. "I'm opposed to this bill in its current form. Corporations get everything they asked for and children got pennies."
