Vance Wants to Increase Child Tax Credit to $5,000

Sen. J.D. Vance of Ohio, President Donald Trump’s former GOP running mate, wants to more than double the child tax credit. But the increase could be difficult to implement, policy experts say.

“I would love to see a $5,000 per child tax credit. But, obviously, you have to work with Congress to see how feasible and doable that is,” he said Sunday on CBS’s “Face the Nation.”

Vance’s idea would be a “relatively large” expansion of the current benefit, capped at $2,000 per child through 2024, according to Garrett Watson, senior policy analyst and head of modeling at the Tax Foundation.

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Without congressional action, the maximum child tax credit will drop from $2,000 to $1,000 once Trump’s 2017 tax cuts expire after 2025.

During the pandemic, lawmakers temporarily increased the maximum child tax credit from $2,000 to either $3,000 or $3,600, depending on the child’s age. Families received up to half of that in monthly payments for 2021.

According to a Columbia University analysis, the child poverty rate fell to a record low of 5.2% in 2021, thanks in large part to credit expansion.

Vance’s comments come less than two weeks after Senate Republicans blocked an amendment to an expanded child tax credit that the House passed with bipartisan support in January.

If enacted, the bill would have improved access to the child tax credit and retroactively increased the refundable portion of the tax break, which could have triggered refund checks from the IRS.

Democrats held the vote partly in response to Vance, who has positioned himself as a pro-family candidate. But the bill was expected to fail without Senate Republican consensus on the credit design.

Vance was not present at the recent Senate vote, but described it as a “show vote” during the CBS interview, noting that it would not have passed even if he had been present.

Meanwhile, President Joe Biden and Vice President Kamala Harris “will continue to fight for an expanded child tax credit,” national economic adviser Lael Brainard said in a statement.

The Trump campaign did not immediately respond to Vscek’s request for comment.

“The child tax credit is obviously a priority for Democrats across the country,” said Richard Auxier, a senior policy officer at the Urban-Brookings Tax Policy Center.

However, Vance’s expansion idea could prove problematic as lawmakers grapple with growing concerns about the federal budget deficit.

Increasing the child tax credit to $5,000 could cost “about $3 trillion” over 10 years, said Watson of the Tax Foundation.

“The immediate question is, of course, how do we manage the costs,” in addition to other proposed changes, including extensions of the expiring Trump tax cuts, he said.

There are also questions about the structure of Vance’s proposed child tax credit and how Vance’s idea might work, including eligibility, work requirements and income phaseouts.

“A lot of Republicans are very skeptical about moving the child tax credit in a direction that would eliminate the work requirement for the phase-in phase-in,” meaning they want only employed families to claim the credit, Watson said.

Vance’s proposal could reignite debate among conservatives and Republicans as the 2025 deadline approaches, he said.