Vice President Kamala Harris announced a sweeping economic plan to provide new benefits to new parents. Speaking in Raleigh, N.C., Harris proposed expanding the child tax credit to provide up to $6,000 in tax relief during the first year of a child’s life.
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Harris, the Democratic presidential nominee, referred to how the provisions for a child tax credit from the American Rescue Plan 2021 would be expanded through this plan. "We will provide $6,000 in tax relief to families during the first year of a child's life," she stated, emphasizing the critical support this would offer to middle – and lower-income families.
It’s a quantum leap from the 2021 child tax credit, which paid out up to $3,600 per child. The new $6,000 credit is designed to further alleviate many families’ financial strain during the early stages of parenthood.
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Harris announced her proposal days after Sen. JD Vance floated a $5,000 child tax credit. Many have not failed to note the timing. “That, to me, sounds very much like a response to JD Vance,” said Kyle Pomerleau, a senior fellow at the American Enterprise Institute.
A campaign official responded to the news by suggesting he would consider a major expansion of the child tax credit. “Trump will consider a major expansion of the child tax credit that applies to American families,” the official said to CNBC.
It’s not just Harris and Vance calling for an expanded child tax credit. Support for such measures is growing bipartisan, despite what happened this month, when Senate Republicans blocked an expanded child tax credit already passed in the House. Still, experts are sure the issue will resurface after the election.
“There is bipartisan momentum behind expanding the child tax credit,” said Andrew Lautz, associate director for the Bipartisan Policy Center’s economic policy program. Lautz added that much of the future depended on who was in control of the White House and Congress, though ongoing conversations around the design and size of the credit are likely to continue.
Unless Congress acts, the $2,000 child tax credit will fall back to $1,000 after former President Donald Trump’s 2017 cuts expire in 2025. The American Rescue Plan temporarily raised the maximum child tax credit value to $3,000 or $3,600 per child based on age. According to a study from Columbia University, that temporary boost brought about the largest one-year decline in the child poverty rate.
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However, Harris’ proposal to expand the child tax credit to $6,000 will come with a heftier price tag. Estimates by the Tax Foundation hold that such an expansion could cost $1.6 trillion over ten years on a conventional basis – an already sizable budget challenge facing lawmakers.
Similarly, Vance’s plan would also be quite costly, as pointed out by Marc Goldwein, senior policy director for the Committee for a Responsible Federal Budget, told CBS Moneywatch: “We could easily be talking about $2-$3 trillion in additional borrowing over the next decade. That’s a tremendous amount of money.”
Harris remains committed to her plan, which she believes is crucial for supporting American families. The campaign's fact sheet on her economic plan also includes calls for higher taxes on wealthy Americans and large corporations to fund these initiatives.
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