Bipartisan bill would let new parents draw on child tax credits doubled by 2017 GOP overhaul
Washington Examiner
A bipartisan bill would let new parents tap into the recently boosted Child Tax Credit to fund time off work, care for babies, and needed supplies.
The bill represents a shift by members of Congress on paid family leave. Until Wednesday, legislation to fund paid leave went in two different directions, with Democrats backing legislation to fund both sick and parental leave through a payroll tax and a handful of Republicans backing legislation to let new parents take from Social Security in exchange for delaying retirement.
Even though the bipartisan bill doesn’t yet have the same amount of support as the Democrat legislation, it tries to build consensus on the lack of available paid leave by approaching the issue differently: It leverages a portion of the 2017 Republican tax overhaul, which doubled the Child Tax Credit for parents to $2,000 a year.
“This is the sweet spot between where Republicans and Democrats can agree,” said Sen. Bill Cassidy of Louisiana, a Republican and one of the lead sponsors of the new bill, called the Advancing Support for Working Families Act.
Other legislation has failed to gain bipartisan support because Republicans oppose raising taxes or imposing mandates on employers, while Democrats object to beneficiaries taking from retirement. Even though Democrats didn’t vote in favor of the 2017 tax overhaul, a handful of them favor taking advantage of the larger Child Tax Credit to advance the party’s long-sought goal of paid family leave.
Cassidy worked with Democratic Sen. Kyrsten Sinema of Arizona on the bill and picked up other Senate co-sponsors along the way: Republican Sens. Steve Daines of Montana and Shelley Moore-Capito of West Virginia and Democratic Sen. Joe Manchin of West Virginia. The House version of the bill, also introduced Wednesday, came from Democrat Colin Allred of Texas and Republican Elise Stefanik of New York.
The bill would give parents the option to receive $5,000 from the Child Tax Credit upfront and then adjusts their tax credit to $1,500 a year for the next 10 years. Parents otherwise get $2,000 a year for each of their children under the age of 17. Should they choose to tap into the credit early, parents would be able to decide what they want to use the money for, whether supplies for babies, childcare, or replacing lost wages.
Cassidy said the amount that parents would forego later would be recouped by increases in salary that are more likely to occur when people remain in the workplace. Several studies have shown that women, in particular, take a pay cut when they leave the workforce to raise children and then return to work years later.
The legislation would provide that families that don’t qualify for the Child Tax Credit, those making less than $12,000 a year, could still get the equivalent of 12 weeks of wage replacement, and then offset the Child Tax Credit during the next 15 years, rather than 10, so that the amount foregone over time is smaller.
“Our proposal is pro-family, pro-business, and it’s pro-21st-century economy,” Stefanik said at a press conference. Moore-Capito called the legislation a “really creative and flexible solution.”
Asked whether Democrats oppose using the Republican tax bill to create the benefit, Sinema said people were looking for help and were less concerned about partisanship.
“Regardless of your feelings of past policies or past votes, families are receiving this Child Tax Credit, and that’s a boon for families… Rather than acting in any kind of conflict, our bill provides assistance to families right now,” she added. Stefanik voted against the 2017 tax legislation.
But the Partnership for Women and Families, which supports the Democrats’ bill, released a statement saying the legislation was a “deceptive bill that doesn’t actually address the realities working people face.” The group noted that most people need to take leave not for parenting, but for caring for a loved one or for a personal illness.
The United States stands in contrast to other industrialized nations in that it has not set a mandatory or subsidized leave policy. Under the 1993 Family Medical Leave Act, employers with 50 workers or more must allow 12 weeks of leave every year so employees can care for a new child or an ill relative, but in most cases, the leave isn’t paid.
Democrats have long wanted to replicate the payroll tax model other countries have. Until recently, Republicans hadn’t become interested in looking at paid leave but were encouraged along by senior White House adviser and first daughter Ivanka Trump. She issued a statement Wednesday saying the “only pathway” for passing paid leave would be “through bipartisan, bicameral legislation.”
Other House co-sponsors were Democrats Joe Cunningham of South Carolina and Jeff VanDrew and Josh Gottheimer, both of New Jersey. Jamie Herrera Beutler of Washington state, Anthony Gonzalez of Ohio, and Bryan Steil of Wisconsin were Republican co-sponsors.