Vice President Kamala Harris’s presidential campaign on Friday announced an economic agenda geared toward populist ideas, including a vow to expand existing tax credits for parents with children and to slash taxes on middle-class Americans.
The Democratic presidential candidate’s plan includes a new $6,000 tax credit for low-income or middle-income families within a newborn child’s first year. It also aims to restore the expanded Child Tax Credit (CTC) and make its benefits permanent.
The CTC was created in the 1990s to help families with the cost of raising children and allows up to $2,000 per child annually. During the pandemic, Congress expanded that allowance to between $3,000 and $3,600, but it lapsed in 2021. Senate Republicans earlier this month blocked a $78 billion tax-cut package that would have expanded eligibility for the tax credit and adjusted payments for inflation for the 2024 and 2025 filing years.
Researchers from the University of Michigan found that the temporary expansion of the CTC made 26 million children across the U.S. newly eligible or receive better benefits, according to a recent study. It also led to a “historic” 46% decline in the nation’s child poverty rate, which dropped from 9.7% to 5.2%, PBS News reported.
In a statement Friday, the Harris campaign contrasted its proposals with those of Former President Donald Trump, claiming that he is “running on a promise to give another billionaire tax break to his ultra-wealthy friends.” The campaign also criticized Trump’s running mate, Ohio Sen. J.D. Vance, for missing the Aug. 1 vote where his colleagues opposed expanded the CTC.
Vance has floated expanding the CTC to $5,000, telling CBS News that he would “love” to see it pass Congress. He also hinted that he would like to see an expanded CTC without income thresholds; currently, single filers who make more than $200,000 or married couples with combined income of more than $400,000 are not eligible.
Although both candidates have supported expanding the CTC, without action it will regress to $1,000 per child by 2026 after Trump’s Tax Cuts & Jobs Act expires. On the other hand, any action expanding the CTC could “easily” add between $2 trillion and $3 trillion in federal borrowing over the next decade, a senior policy director for the Committee for a Responsible Federal Budget told CBS.
The Harris campaign also announced proposals to expand the Earned Income Tax Credit to slash taxes by up to $1,500 for low-income individuals and couples who don’t have children and cut taxes to help Americans afford health insurance. Harris will also take aim at high prescription drug prices, expensive grocery bills, and Wall Street’s homebuying spree.
The vice president is expected to reveal more details of her economic plan Friday afternoon while speaking at a rally in Raleigh, North Carolina.
