Research Finds Investment in Permanent Child Tax Credit Would Pay Off 10-Fold

New research shows that the benefits of an expanded child tax credit would outweigh any costs if it were made permanent.

A working paperResearchers at Columbia University, Barnard College, and Open Sky Policy Institute found that if low-income familiesOne child could see their income rise by $1,000 per year. The benefits of the program would outweigh the 10-fold cost.

The government would have to make the program permanent, but it would provide social benefits of $982 billion. These benefits include direct effects such as increased health and longevity of parents and children, future earnings for children, and indirect benefits such as lower crime rates. Research shows that taxpayers would also benefit by a $135 billion reduction in taxes.

Many working papers are not yet peer-reviewed or edited for publication in a journal. If the paper’s findings are true, it bolsters arguments from advocates of expanding the tax credit that the benefits of the program quite literally outweigh the costs.

Other research shows that the COVID stimul bill’s expanded child credit, which paid $300 per month for children younger than 6, and $250 per monthly for children 6 to 17, had a tremendous impact on the economy. Data released Last monthIt was found that child poverty rose by 41 percent after the January expiration of the tax credit, putting 3.7 million children in poverty.

You also get a variety of other benefits from the credit card food insufficiency rates decreasedConsumer spending increased, and people were able to get credit. keep their jobs, which could help to pay for high child care costs.

Other surveys also indicated that the tax credit was a transformative tool for families. The Census Bureau It has been foundThe credit was used by 91 percent of low income families to purchase necessities. Family members account for 92 percentAccording to a SaverLife survey, 71% of respondents felt that the payments had improved their financial stability.

The Congress was dominated by Democrats who wanted to extend the child credit for 10 years or make it permanent. But conservative Sen. Joe Manchin (D-West Virginia)The program was strongly opposed by them. even though it was helping to keep children out of poverty. Democrats have vowed to keep working to get the proposal passed — but despite their attempts to pressure Manchin on the issue, the senator has been uninterested in discussing it.

Some conservatives are proud to be conservatives tried reviving the proposal by tyingIt is required to work, but advocates sayAdding hurdles to the program would only make it more difficult for the money reach the families most in need.

Progressive lawmakers expressed their frustration Last yearManchin demanded that they pick between the tax credit, paid leave, and child care funding plans that were included in some versions the Build Back Better Act.

Some progressive lawmakers have called to reintroduce the expansion. “Another month without the expanded Child Tax Credit and working people continue to pay the price,” wrote Congressional Progressive Caucus Chair Rep. Pramila Jayapal (D-Washington) on Wednesday. “We have to fix this. Renew it now.”