Finance

Dems counter Trump law with bill to expand tax credits

Stefani Reynolds

Democratic senators on Wednesday introduced legislation to expand tax credits for workers and families, saying the measure would act as a counterweight to President Trump’s 2017 tax-cut law.

The bill would expand two tax credits: the earned income tax credit (EITC), which benefits low- and middle-income workers, and the child tax credit (CTC), for families with children.

“Our bill would help put more money back in the pockets of working families and set children up for future success,” Sen. Sherrod Brown (D-Ohio), a lead sponsor of the bill, said in a statement.

Senate Democrats drew a contrast between their bill and Trump’s 2017 tax law, which they argue primarily benefited wealthy individuals and corporations. The law includes an expansion of the CTC, and the Democrats’ bill would expand it further to help people who didn’t benefit from the full increase of the credit under the 2017 law.

The liberal-leaning Center on Budget and Policy Priorities estimated that the new bill would lift 29 million people, including 11 million children, above or closer to the poverty line.

The measure is sponsored by more than 40 Democratic and independent senators, including Brown, Sen. Michael Bennet (D-Colo.) and Sen. Ron Wyden (D-Ore.). All three serve on the Senate’s tax-writing committee, and Wyden is the ranking member on the panel.

“We need to rewrite the tax code in a way that benefits working families – and expanding the Child Tax Credit and Earned Income Tax Credit is an effective path to achieve that,” Bennet said.

For workers without children, the bill would raise the maximum EITC amount from $530 to $2,070 and expand the age range of eligible recipients. For workers with children, the bill would increase the EITC by about 25 percent. Additionally, EITC recipients would be able to get a one-time, $500 advance of their credit.

The bill would make the CTC fully refundable, and create a new credit for families with children ages five and under. It also would provide tax relief for people living in Puerto Rico and give the IRS the authority to create standards for paid tax-return preparers.

 

Tags Donald Trump Michael Bennet Ron Wyden Sherrod Brown

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