Tax Credits Are A Complementary Policy, Not A Replacement For Significant Direct Spending And Bold Reforms

The COVID pandemic has pushed child care and early learning to the brink, with the sector losing one in six jobs and thousands of providers on the verge of shutting their doors. The pandemic has especially harmed communities of color, as women of color are disproportionately represented in the early education workforce and families of color have all too often struggled to find and afford care, even before the pandemic. To support child care through COVID and to ensure a robust recovery and an equitable economy in the future, child care requires at least $50 billion in direct public spending to support providers and families.

This week, CLASP, alongside the National Women's Law Center and The Century Foundation, released a fact sheet detailing the importance of direct spending for the child care industry. “Why Child Care Needs Direct Spending, Not Just Tax Credits, During COVID and Beyond” highlights that while a tax credit targeting families’ child care costs can play a small, complementary role in helping to offset the cost of care for families, our nation needs an influx of public investment to address the range of urgent needs in the child care crisis. 

Tax credits are complementary policy, not a replacement for significant direct spending and bold reforms. Families and providers have waited far too long for the support they need. Effectively providing this support to address the range of urgent needs in the child care crisis through direct public spending to providers must be part of any COVID relief package.

If you have any questions, please contact Kate Gallagher Robbins at [email protected]. 

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