Republican Alabama Sen. Katie Britt is pushing Republicans to strengthen child care benefits in the party’s tax legislation expected later this year.
The proposal Britt introduced is cosponsored by Democratic Virginia Sen. Tim Kaine. Britt’s and Kaine’s childcare proposal dives into the crucial issue in two parts: the Child Care Availability and Affordability Act and the Child Care Workforce Act.
The CDCTC tax credit would allow for lower-income families to benefit from the tax credit for the first time, alleviating their out-of-pocket childcare costs. Under the reformed CDCTC, families with one child would receive a $2,500 tax credit, and those with two or more children would get $4,000.
The second aspect of the Availability and Affordability Act is the DCAP. This program will be expanded, allowing for families to deduct 50% more in expenses with a cap of $7,500. The DCAP is currently combined with the CDCTC, but this proposal would separate them, giving middle class families that aren’t eligible for the CDCTC access to the tax credit.
The final part of the Act is the Employer-Provided Child Care Tax Credit, which “radically bolsters” the preexisting tax credit, incentivizing businesses to provide childcare for their employees. The business tax credit would leap from its current $150,000 to $500,000, as well as cover 50% of expenses rather than 25%. If a business is small enough, or multiple small businesses come together to do joint applications and pool resources, the credit would jump even higher to $600,000.
https://x.com/SenKatieBritt/status/1896984096611696816
The second part of the proposal, the Child Care Workforce Act, is new. The pilot program would establish a competitive grant system, incentivizing state and local governments, Indian Tribes and Tribal organizations interested in participating in pay supplement programs for childcare workers. The program is designed to increase the supply of care providers and reduce turnover. This program has been tested in D.C., Maine, Nebraska and Virginia, proving to be successful in worker retention, well-being and satisfaction. The grants would be applicable for home-based and center-based childcare providers as long as they are licensed under the state, and evaluations of care quality, availability, impact and turnover are mandatory to benefit from the program.
“Republicans ran and won as the party of families and hardworking Americans. I believe whether a parent wants to stay at home or return to the workforce, that option should be available to them. The unfortunate reality is that the rising cost of childcare has delayed too many Americans from starting and growing their family,” Britt told the Daily Caller News Foundation. “My bill, the Child Care Availability and Affordability Act, updates tax benefits that otherwise have not been touched since 1986 and 2001. Importantly, it is also a fraction of the cost compared to other family policy proposals. Assisting working parents with childcare costs should be just one of the boosts families receive in the upcoming tax bill. I look forward to working with my colleagues to deliver a pro-family, pro-growth agenda.”
The tax credits would be a part of the Republican’s tax package that is expected to be finalized later this year. As Democrats consistently slam Republicans for allegedly giving the wealthy tax cuts, it’s pushed some Republicans to emphasize provisions for working families. Britt’s and Kaine’s proposal is currently backed by Republican Sens. Joni Ernst of Iowa, Susan Collins of Maine, John Curtis of Utah and Shelley Moore Capito of West Virginia.
“After four years of price hikes, I am focused on delivering relief to Iowans,” Ernst told the Daily Caller News Foundation. “Finding affordable, high-quality childcare is one of the most pressing issues for hardworking folks across the state. Lowering the cost of childcare not only helps families but also knocks down one of the biggest hurdles for small businesses looking to hire and retain capable employees.”
“The childcare crisis is holding our families and economy back. I hear from Virginia parents all the time about how hard it is to find affordable child care, from child care providers who are forced to leave their jobs because of low wages, and from businesses who are having trouble finding the employees they need,” Kaine said after the proposal’s announcement. “I’m proud to join my colleagues in introducing this bipartisan legislation, and I hope more of my colleagues will join us in passing this comprehensive proposal to support childcare providers, make it easier for families to access the care they need, and boost economic growth by providing parents with the opportunity to get back into the workforce.”
“If the Republican Party wants to make good on being the party of families and being the party of workers, I could think of no better way than helping drive down the cost of child care,” Britt told Semafor, adding the proposal “is a very targeted approach.”
“We lose, as an economy, $122 billion a year due to childcare issues. If you look at the cost of this over 10 years … the cost-benefit analysis of this just
