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WASHINGTON – The U.S. House of Representatives voted overwhelmingly Wednesday to approve a $78 billion tax package that would expand the child tax credit and restore some tax incentives for businesses.
The 357-70 The vote sends the bill, called the Tax Relief for American Families and Workers Act of 2024, to the U.S. Senate, where lawmakers are expected to vote on it at some point, although its passage is not guaranteed. All 14 North Carolina representatives voted “yes,” except Republican Dan Bishop, who voted “no.”
Debate in the House on the 84 page size It was broadly bipartisan, with Democrats and Republicans backing the deal between Missouri Republican Rep. Jason Smith, chairman of the House tax-writing committee, and his Senate counterpart, Finance Chairman Ron Wyden, an Oregon Democrat.
Members of both political parties also spoke against the bill: Several far-right lawmakers argued that expanding the child tax credit would expand the “welfare state” and progressive Democrats said the bill did not go far enough. to provide relief to low-income families. income and working families.
“Each of these policies will help American companies grow, create jobs and sharpen their competitive advantage against China,” Smith said.
The child tax credit expansion, he said, continues provisions Republicans added to the 2017 tax law they passed during the Trump administration, while updating some of the language.
“We are maintaining work requirements while enhancing the benefit to support families crushed by current inflation and eliminating the penalty for families with multiple children,” Smith said.
Massachusetts Rep. Richard Neal, the ranking Democrat on the tax-writing committee, said expanding the child tax credit would immediately help 16 million children nationwide.
“This is not the bill I would have written, but it is a sensible policy,” he said of the overall package.
Neal sharply criticized far-right Republicans who spoke out against the measure during the debate and called the CTC “welfare.”
“I can’t believe we’re here tonight and hearing that addressing child poverty is wellness,” Neal said.
Immigrants and child tax credit
Freedom Caucus Chairman Bob Good of Virginia, Matt Gaetz of Florida, Thomas Massie of Kentucky, Scott Perry of Pennsylvania and Chip Roy of Texas were among the Republicans who argued against passage during the floor debate.
All expressed frustration that child tax credit payments could go to undocumented immigrants, even though a provision in the 2017 Republican tax law requires the child to have a Social Security number. And several also criticized tax credits for businesses.
“Young children are not sent checks even if they have a Social Security number. But their parents, who are here illegally, do,” Perry said.
Georgia Republican Rep. Drew Ferguson vehemently rejected the criticism, saying he did not care “in the slightest about ensuring that American businesses are more competitive on the global stage.”
“This is not about giving companies a tax break, this is about investing in America and American jobs,” Ferguson said. “And the complete mischaracterization of the child tax credit is the most intellectually dishonest conversation I have heard in this room in a long time.”
“This is about ensuring that working people and their families have the ability to get ahead,” Ferguson added.
Connecticut Democratic Rep. Rosa DeLauro, one of the House’s most progressive members and a longtime supporter of the CTC, also said she could not support the bill, arguing it was a “mockery of who the government works for.” representative”.
“I cannot vote for a deal that so lopsidedly benefits large corporations while failing to guarantee a substantial tax cut for middle and working class families,” DeLauro said. “The agreement is not equitable at a time when we have seen a rise in inequality.”
If Congress passes the bill, President Joe Biden will likely sign it.
White House press secretary Karine Jean-Pierre said in mid-January that the legislation was a “welcome step forward.”
“And we think Congress should approve it,” he said.
What’s in the child tax credit?
The bill would expand the current child tax credit, which is up to $1,600 per child, to a maximum of $1,800 in 2023, $1,900 in 2024 and $2,000 in 2025. The expansion would expire after that.
The three-year expansion of the child tax credit would fall short of the level approved by Congress during the COVID-19 pandemic, when it maxed out at $3,000 or $3,600 for children under 6 years old.
The bill includes several tax incentives for companies, including a provision that would immediately allow companies to deduct research and development investments made within the United States.
The bill “would strengthen the United States’ competitive position with China by eliminating the current double taxation that exists for companies and workers with a presence in both the United States and Taiwan,” according to a summary of the legislation.
The legislation would help make housing more affordable through an enhancement of the low-income housing tax credit and other provisions.
Parts of the legislation are intended to help communities recover from natural disasters, including tax relief for families harmed by hurricanes, wildfires, floods or the train derailment in East Palestine, Ohio.
The legislation would be funded by ending a tax break for businesses that kept employees during the COVID-19 pandemic, known as the employee retention tax credit. The law would end the ability for companies to file new claims on January 31 instead of April 15, 2025.
The House Ways and Means Committee voted 40-3 in mid-January to submit legislation to the ground.
‘Children who need diapers and shoes’
Senate Majority Leader Chuck Schumer, a Democrat from New York, said Wednesday that he supports the tax bill and will work to determine when and how it should go to the floor for a vote.
Wyden, chairman of the Senate tax-writing committee, said he will speak with Schumer to determine whether there will be amendment votes on the package. But he said he wants it to be voted on “as quickly as possible.”
Wyden also rejected some criticism that the bill does not include a more significant expansion of the child tax credit, noting that it lasts three years and that Congress will need to renegotiate tax policy after that.
“We have kids who need diapers and shoes and who pay for essential products (and) small businesses that are trying to compete with China,” Wyden said. “I have to say, ‘Keep going,’ ‘Do it.’”
West Virginia Republican Sen. Shelley Moore Capito said she expects the Finance Committee to make a markup before the bill moves to the Senate floor.
“I think they need to move it through Finance and have an amendment process without having everything decided beforehand,” Capito said. “That’s what bothers people when they try to make policy: they don’t have any opportunity to have a say. So I’m in favor of the committee process. Bring it in and let it go through the committee.”
North Carolina Republican Sen. Thom Tillis said he has several concerns with the bill, including that it is “not comprehensive enough.” He said he hopes leaders will hold votes on amendments on the floor.
“I’ve been saying it’s a mistake. I also believe the payment is false,” Tillis said. “I mean, it’s a program that we didn’t pay for when we were doing COVID bills and that we’re now considering paying for. And the biggest part of that is actually recovering from fraud and abuse.”
“Here’s a concept: Why don’t we send that back to the Treasury and start filling the $34 trillion hole we have?” Tillis said, referring to the national debt.
Indiana Republican Sen. Todd Young said he and Idaho Sen. Mike Crapo, the top Republican on the tax-writing committee, hope to make changes to the legislation once it reaches their chamber.
“We still hope to make improvements,” Young said, although he declined to detail what changes he wants to make to the fiscal package. “I’m not going to give any more details.”
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