Sen. Josh Hawley (R-Missouri) is proposing a major expansion of the Child Tax Credit (CTC), and is at odds with budget hardliners as Republican lawmakers work toward a tax priority bill. Setting up a potential battle.
Hawley wants to increase the CTC from $2,000 to a maximum of $5,000 per child. According to Axiosfirst reported on this plan.
“President Trump won with the support of working families with children. Next year's tax bill should deliver significant tax cuts,” Hawley wrote in a social media post.
The plan could add trillions of dollars to the national debt, which has ballooned to a new high of about $36 trillion following pandemic relief measures.
When the CTC was increased from $2,000 to $3,600 per child in 2021, the Congressional Budget Office estimated that if made permanent, it would increase the budget deficit by $1.6 trillion over the next 10 years.
Mr. Hawley's plan is about twice the size of that expansion, suggesting the budget deficit could rise by more than $3 trillion before accounting for inflation.
The plan could face resistance from Republicans concerned about spending levels.
Republicans are completely in sync on what to do with the tax bill before it expires at the end of next year.
Incoming Senate Majority Leader John Thune, R.S., said he wants to focus on border security and energy production bills before moving on to tax reform later this year.
But House Republicans have rejected that idea, insisting they either introduce a tax bill first or combine taxes, energy and the border into the same bill.
House Republicans have said they are looking to President Trump to break the deadlock, but Trump has not yet weighed in on the dispute between the two chambers.
Conservative strategists are warning of a lack of coordination within the Republican conference.
“Delaying is killing,” warned Grover Norquist, founder and chairman of Americans for Tax Reform, which opposes tax increases. “And all it takes is one bad car accident or some interesting scandal and the Republicans no longer have a majority in the House.”
Unless extended by new legislation next year, the CTC per child will be reduced from the current level of $2,000 to $1,000.
When that amount was increased to $3,600 in the Biden administration's American Rescue Plan, it helped raise millions of children above the poverty level, according to a Columbia University study.
