U.S. Senate Fails to Advance Expanded Child Tax Credit, Despite Broad House Support

Source:https://ohiocapitaljournal.com/

Senate Republicans and two independents blocked a bipartisan tax package that aimed to temporarily expand the child tax credit and renew tax breaks for some businesses. The 48-44 procedural vote was seen as a strategic move by Senate Majority Leader Chuck Schumer before the August recess and the upcoming November elections.

Schumer criticized the Republicans, claiming their vote against the bill was driven by partisanship rather than policy, leaving American families without additional support. This vote was the last action of the Senate before its September return, while the House had already started its August recess.

Many Senate Republicans, including top tax writer Mike Crapo, opposed the bill, dismissing the vote as a “doomed-to-fail show vote” focused more on election messaging than actual legislative progress. The bill required 60 votes to advance but did not secure enough in the closely divided Senate.

Senator Mike Crapo expressed a willingness to negotiate an extension of the tax changes beyond 2025 if Democrats are committed to aiding working families. Taxation is becoming a key campaign issue as the Trump-era tax law is set to expire at the end of 2025, setting up a major debate for the next administration. Senator Ron Wyden, chair of the Senate Finance Committee, highlighted that the bill had significant bipartisan support in the House, with 357 votes and backing from every Republican on the Ways and Means Committee.

In a recent interview, J.D. Vance incorrectly claimed that Vice President Kamala Harris opposed the child tax credit, a statement refuted by evidence showing that Harris and other Democrats support a permanent expanded child tax credit similar to the pandemic-era version, which was effective in reducing poverty. Following Vance’s absence from a crucial Senate vote on the tax package, the Democratic National Committee criticized him, suggesting voters will remember his absence when they head to the polls in November.

The bipartisan tax package, crafted by Senator Ron Wyden and Representative Jason Smith, was approved by the House in January with a 357-70 vote. The bill proposed increasing the child tax credit from $2,000 to $2,100 through 2025, adjusting for inflation, and raising the refundability limit to $1,800 for 2023, $1,900 for 2024, and $2,000 for 2025. Funding for the bill was planned through recovering funds from a fraud-ridden pandemic tax break. However, the nonpartisan Committee for a Responsible Federal Budget warned that extending these policies beyond 2025 could significantly increase federal debt.

The bill includes a provision allowing families to use a previous year’s higher income for tax credit calculations, which has faced strong opposition from Senate Republicans who view it as welfare. Additionally, the bill aims to temporarily reinstate two tax incentives from the 2017 Trump tax law: the full expensing of domestic research and development and immediate 100% deduction of equipment purchases. In March, business owners, CEOs, and a union official urged the Senate Finance Committee to advance the bill.

The legislation also includes measures to increase low-income housing tax credits, alleviate double taxation for Taiwanese residents, and exempt relief payments for victims of the 2023 East Palestine train derailment, although the IRS had mostly addressed this earlier. Supporters of the bill include the Business Roundtable and the Economic Security Project. Anna Aurilio from the Economic Security Project criticized Republican senators for prioritizing politics over family support and argued that the expanded Child Tax Credit, which helped many struggling parents, should be made permanent in future tax reforms.

Read More: https://childreninfobank.com/safebank/u-s-senate-fails-to-advance-expanded-child-tax-credit-despite-broad-house-support/

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