In Pennsylvania child and dependent care enhancement tax credit program, further providing for credit for child and dependent care employment-related expenses.
Impact
The anticipated effect of HB 169 is likely to reduce the financial burden on families utilizing child care services, promoting workforce participation among parents, especially mothers. By providing a more substantial tax credit, it encourages more productive use of child care resources, potentially driving up employment rates. Lawmakers who support this bill argue that it not only benefits individual families but also has the potential to stimulate local economies by allowing more parents to work without the dire financial stress of child care costs. Thus, HB 169 is positioned as a reflection of state prioritization of child care accessibility and affordability.
Summary
House Bill 169 aims to amend the Pennsylvania Tax Reform Code of 1971 by enhancing the child and dependent care tax credit program. This amendment specifically adjusts the percentage of the tax credit available to taxpayers for child and dependent care employment-related expenses, increasing it progressively over the next several years. For example, starting in the taxable year after December 31, 2022, taxpayers can claim up to 50% of their employment-related expenses, increasing to 75% by the taxable year after December 31, 2023, and thereafter at 100% for subsequent years. The bill is designed to provide greater financial support to families for child care, which is seen as a critical need to support working parents in Pennsylvania.
Sentiment
The sentiment surrounding HB 169 is generally positive among legislators advocating for child care services and family support. Supporters believe this bill is a constructive step toward addressing child care costs that have become prohibitively expensive for many families, especially in times of economic strain. However, some skepticism exists regarding the long-term funding availability for such tax credits, with critics expressing concerns about sustainability and potential impacts on the state budget. Overall, the positive approach toward enhancing support for families is overshadowing criticisms of potential fiscal constraints.
Contention
While there is unifying support for enhancing child and dependent care tax credits among several lawmakers, concerns focus on the scaling of benefits and fiscal implications. Debates may arise regarding how incrementally increasing credits could affect state tax revenues and the broader budget allocation. There may also be discussions on the adequacy of the proposed limits for qualifying expenses, which critics argue could leave out families that rely on non-traditional child care providers. Addressing these tensions will be critical as the bill progresses through legislative consideration.
In personal income tax, further providing for classes of income; and, in Pennsylvania Child and Dependent Care Enhancement Tax Credit Program, further providing for credit for child and dependent care employment-related expenses.
In tax credit and tax benefit administration, further providing for definitions; providing for Pennsylvania Child and Dependent Care Enhancement Tax Credit Program; and making a repeal.
In personal income tax, further providing for classes of income and for special tax provisions for poverty and providing for alternative special tax provisions for poverty; in corporate net income tax, further providing for definitions, for imposition of tax, for reports and payment of tax, for consolidated reports and for manufacturing innovation and reinvestment deduction; in realty transfer tax, further providing for transfer of tax; in tax credit and tax benefit administration, further providing for definitions; in entertainment production tax credit, further providing for definitions, for credit for qualified film production expenses, for carryover, carryback and assignment of credit and for limitations; in Pennsylvania Economic Development for a Growing Economy (PA EDGE) tax credits, providing for biotechnology; in neighborhood assistance tax credit, further providing for tax credit and for grant of tax credit; providing for expanded neighborhood improvement zones; in Pennsylvania Child and Dependent Care Enhancement Tax Credit Program, further providing for credit for child and dependent care employment-related expenses; providing for Public Transportation Trust Fund; and, in general provisions, further providing for underpayment of estimated tax, for method of filing and for allocation of tax credits.