By Lauren Pescatore
If lawmakers are serious about tax reform that works for families, they should focus on improving tax credits and other benefits for low-income women and their children, a new brief from the National Women’s Law Center (NWLC) argues. But NWLC analysis finds that both the House and Senate Republican tax plans would instead raise taxes on lower-income women and their families to pay for tax breaks for corporations and the wealthy.
While both plans propose expanding the Child Tax Credit (CTC), the increase is targeted toward higher- income families and largely excludes women and children in low-income households. What’s more, Republican lawmakers have proposed requiring a Social Security Number for each child claimed for the refundable portion of the CTC, which could exclude a significant number of children in immigrant families.
Among those with the lowest incomes in the U.S., female-headed households are overrepresented. Nearly two-thirds of workers earning the minimum wage are women, many of whom are supporting children. The plans threaten numerous tax benefits for these low-income women by eliminating personal and dependent exemptions, reducing or eliminating the deduction for state and local taxes, and eliminating benefits that help low-wage workers offset work-related expenses.
NWLC argues that Congress should use this opportunity to expand the CTC for those with the lowest incomes, as well as improve the Child and Dependent Care Tax Credit and Earned Income Tax Credit to target tax relief at those who need it most. According to the Center, these tax credits keep millions of women and their families out of poverty each year and provide a significant economic boost by incentivizing work and improving health and educational outcomes for children.
To read the full fact sheet and find further NWLC analysis of the Republican tax plan, click here.