Davis, Shusterman provision included in tax reduction bill

HB 1219 would expand Child and Dependent Care Tax Credit Program

HARRISBURG, Oct 4 – State Reps. Tina Davis, D-Bucks, and Melissa Shusterman, D-Chester, highlight the inclusion of a child and dependent care tax credit program in the House tax code bill which was passed Tuesday.

This provision expands Pennsylvania's Child and Dependent Care Enhancement Tax Credit by increasing the percentage taxpayers can claim as well as increasing the allowable expenses.

“Families are faced with steep childcare costs and difficult decisions,” Davis said. “This bill will provide a much-needed tax break to families throughout the commonwealth. Our children deserve exceptional childcare, and parents should be able to provide it without worrying about breaking the bank.”

Shusterman echoed Davis’ comments.

“Here in the commonwealth, childcare for one child averages $12,000 a year, often more,” Shusterman said. “The hardworking parents of Pennsylvania do not deserve to be priced out of childcare and in turn, being denied the opportunity to work year-round.”

Sept. 30 was the end of pandemic-era federal aid to childcare providers. For many providers, stuck in the middle between pricing pressures and rising costs, this aid was the one thing keeping them open. Now, parents are facing a childcare cliff as nearly 3,000 Pennsylvania childcare programs are expected to close in the near future, impacting over 152,000 of the commonwealth’s children, according to a report by The Century Foundation. Davis and Shusterman want to bring attention to this childcare crisis and encourage stakeholders to collaborate on innovative solutions.

The lawmakers noted the tax credit does not solve the childcare crisis in Pennsylvania, but it is one piece of the puzzle to move towards creating a better solution for working parents.

Davis and Shusterman also highlighted the substantial wins for communities across the state that were included with Tuesday night’s vote. By including an Earned Income Tax Credit for hardworking Pennsylvanians, to investing in affordable housing and public transportation, they said the House’s tax cut plan is a $1 billion investment in Pennsylvania’s economy and working families. The plan also strengthens the state’s business climate by offering meaningful tax reform to make Pennsylvania more competitive, encourage growth, and promote tax fairness.

Shusterman and Davis agreed that the plan is a responsible approach to closing this year’s budget cycle, saying it boosts working families and businesses that drive the economy and creates jobs by offering tax credits that will spur economic activity.