Vermont lawmakers want to increase day care subsidies for middle-class families.
How do they intend to pay for it? Why, by cutting the state’s middle-class child tax credit.
WHAT DOES IT TELL US THAT HALF OF THE 'BEST COUNTRIES FOR WORKING PARENTS' HAVE VERY LOW BIRTHRATES?
The day care-and-tax-hike bill that just cleared a committee in the state senate would transfer wealth from parents who don’t use commercial day care — who may have one parent stay at home, or who may rely on family for child care — to those who do. The bill would take choices away from parents and, using the power of the state, push them toward the model of dual-full-time-income-plus-day care families.
These lawmakers would, in short, subsidize wealthy two-income families while hiking taxes on poorer families — literally one of the worst child care proposals in the history of America. And Vermont might actually pass it.
Here’s the background: Vermont already subsidizes day care. Poor families (up to about $45,000 for a family of four) get their child care totally covered by the state government, and middle-class families (up to about $100,000 for a family of four) get some state subsidies for child care.
One bill advancing through the legislature would extend partial subsidies to families of four earning under $180,000 and set the full subsidy threshold at $55,000. This would cost the state about $160 million per year, adding about 2% to the state budget.
How to pay for it? The Senate Finance Committee just voted to axe the brand-new child tax credit. This tax credit is $1,000 per child for households earning under $125,000 and a reduced amount for those earning more.
The office of Gov. Phil Scott (R) has pointed out the perversity of this proposal. It would provide no benefit to those parents who already receive fully subsidized child care, but it would hike their taxes by $1,000 per child. About 40% of the tax credit money goes to such lower-income families, and those families’ loss would be gains for families earning $150,000 or more.
The biggest losers would be parents who currently use the tax credit in order to cut back on work and thus spend more time with their children.
Of course, there are plenty of ideologues who want exactly that — for reasons grounded either in outdated workist feminism or a single-minded focus on GDP, they want to push parents into work faster than those parents would like.
There’s a big debate in Washington, D.C., and state capitals about how to help parents and children these days, especially as birthrates drop and parents find work-life balance difficult. The questions aren’t easy ones, but this part should be obvious: don’t tax parents to subsidize day care.