Congressional Democrats ‘Challenge’ Republicans to Partner in Cutting Taxes for Working Families
March 5, 2015Print
By Kate Skochdopole
This week, Congressional Democrats proposed a package of tax cuts to provide relief for middle class families and challenged Republicans to join them in the effort. The package, put forth by Sens. Richard Durbin (Ill.), Charles Schumer (N.Y.), Jack Reed (RI) and Patty Murray (Wash.), would improve existing tax credits for working families as well as create new ones.
The proposals include:
- The Working Families Tax Relief Act, which would make permanent improvements to the Earned Income Tax Credit (EITC) and Child Tax Credit (CTC) scheduled to expire in 2017, expand the EITC for childless workers and index the CTC to inflation.
- The 21st Century Workers Tax Cut Act, which would introduce a new tax credit for two-earner families with children. The credit would cover expenses that stack up when both parents work such as the increased cost of childcare and transportation. The bill also would reduce a family’s earned income for the purposes of calculating the EITC.
- The Helping Working Families Afford Child Care Act, which would increase the value of the Child and Dependent Care Credit to reflect the rising cost of childcare.
Meanwhile, Senators Marco Rubio (R-Fla.) and Mike Lee (R-Utah) introduced a tax reform framework yesterday that would condense the current seven tax brackets down to two, lower corporate tax rates and eliminate many existing individual deductions. The plan notably excludes any protection for the EITC and other vital tax credits for workers. Even though the plan features an increased Child Tax Credit, experts argue that the increased credit would largely benefit higher-income families rather than those with modest wages. Sen. Rubio, who is expected to announce his candidacy for president in the coming weeks, said these reforms would guide his tax plan if elected.