U.S. Senator Katie Britt (R-Ala.) has drawn broad support from community leaders, business organizations, and industry stakeholders for her role in advancing increased and modernized tax credits to improve child care access and affordability. These measures were included in President Trump’s Working Family Tax Cuts legislation.
The recent passage of updates to the Child and Dependent Care Tax Credit (CDCTC), the Dependent Care Assistance Program (DCAP), and the Employer-Provided Child Care Tax Credit (45F) marks a significant change. The CDCTC and 45F had not been permanently updated since 2001, despite child care costs rising by over 260% during that period. The DCAP had not seen changes since 1986.
Modernization of these credits is expected to provide tax cuts to nearly four million working families. The update allows parents to set aside up to $7,500 in pre-tax flexible spending accounts for child care—a 50% increase from previous limits—and encourages more employers, particularly small businesses, to offer child care benefits.
Media outlets have noted the significance of these changes. Bloomberg wrote: “For me, the big win is that the new law expands the child and dependent tax credit — not to be confused with the child tax credit. The expansion of the former tax credit allows it to cover up to 50 percent of eligible child care costs, and the cap is now indexed to inflation. This tax credit was created nearly 50 years ago, with an average claimed credit of $206. Inflation and the relative cost of child care have eaten away at the size of that credit, which has not been expanded since 2001 except for a pandemic-related boost.
“But zooming out from the specifics, it’s shocking to take a step back to see that it is Republicans who have achieved the most significant concrete changes to family policy in recent memory. It’s the GOP that got the last laugh when it comes to family policy.”
Vox observed: “Lawmakers plan to invest $16 billion [from the GOP megabill] into three federal tax credit programs that haven’t been permanently updated in decades. That a Republican-led Congress would lead on new child care spending is unusual and reflects changing political priorities …
“Even Democrats, who made child care central to their social agenda, failed to deliver when they held unified control in 2021 … The new child care provisions — spearheaded primarily by Sen. Katie Britt of Alabama — deliver distinct nudges toward affordability, access, and infrastructure.”
Family Matters commented: “So it makes sense for Republicans to chart out the correct proactive steps to improve child care choices beyond simply ‘increase the Child Tax Credit,’ which is directionally correct but insufficient — and, as we recently saw, something that remains somewhat of an uphill slog in this iteration of the G.O.P. Sen. Britt is correct to note the political and substantive win in championing benefits that do support working families…
“…Britt’s example demonstrates what it looks like to devote political capital to supporting parents — something that more Republican lawmakers could learn from. And it shouldn’t take two-and-a-half decades before the next time lawmakers (from either party) figure out a way to improve programs that support working families.”
Newsweek highlighted bipartisan efforts: “These child care-related tax breaks work together to ease the burden on parents and help employers attract and retain talent. Initially designed to help parents offset the cost of care, they have remained largely untouched for decades, even as costs soared and family needs shifted. The improvements in the recent bill represent billions in federal investment in child care and represent one of the most significant permanent investments in care since the pandemic.
“Second, these credits have a long track record of support from both Republicans and Democrats on Capitol Hill. Members of Congress have been working on legislation to improve these tax credits for years… The new law includes many provisions outlined in these bills… spearheaded by Sen. Katie Britt (R-Alabama)…”
Senator Britt said: “I am not setting down the mantle. I’m going to continue to carry it… I think that this is monumental.”
The Bipartisan Policy Center noted: “Three main tax provisions—the CDCTC, DCAPs, and 45F credit—help families offset the costs of child and dependent care or employers offset the costs of providing childcare supports… Enhancements… were omitted… while temporarily expanded… they had not been meaningfully changed…”
They also pointed out bipartisan sponsorship through acts such as The Child Care Availability and Affordability Act introduced by Sens. Katie Britt (R-AL) and Tim Kaine (D-VA).
Business groups also expressed their support:
Rodney Davis from U.S Chamber of Commerce stated: “Childcare is an essential foundation for a strong workforce… We applaud Senators Britt and Kaine for their commitment…”
Jon Barganier from Manufacture Alabama said: “We know that childcare is an essential resource for working parents… We applaud Senator Britt for her vision…”
Mark Dixon from A+ Education Partnership commented: “Every child needs a strong start… we support this important effort…”
Helena Duncan from Business Council of Alabama added: “Making childcare more affordable… Last year Alabama successfully passed legislation… Senator Katie Britt is addressing this issue at federal level…”
