Letter - People Power United joins coalition to urge House Republicans Care Can't Wait
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People Power United joined other local, state, and national groups to support send a letter to House Republicans to make the tax code fairer and to raise more revenue that can support long-overdue investments in women, families, disabled people, older adults, communities, and our shared economy.
Shout out to Care Can’t Wait for leading these efforts. Here is the letter sent on behalf of our membership:
October 15, 2024
The Honorable Jason Smith
Chairman, U.S. House Committee on Ways & Means
U.S. House of Representatives
Washington, DC 20515
The Honorable Mike Kelly
Chairman, U.S. House Committee on Ways & Means Subcommittee on Tax
U.S. House of Representatives
Washington, DC 20515
Dear House Ways and Means Committee Republican 2025 Tax Teams:
The Care Can’t Wait Coalition and the undersigned 105 care, gender justice, racial justice, and allied advocacy organizations write to urge you to take the opportunity of the upcoming expirations of the temporary provisions of the Tax Cuts and Jobs Act of 2017 (TCJA) to make the tax code fairer and to raise more revenue that can support long-overdue investments in women, families, disabled people, older adults, communities, and our shared economy. By asking the wealthiest individuals and wealthy corporations to pay their fair share, lawmakers can leverage the tax code to support robust public investments such as guaranteed access to early education (including child care and pre-K), comprehensive paid family and medical leave, robust aging and disability care, and good jobs for all care workers.
All of us will need care at some point in our lives, and families, communities, and our economy rely on care to function. But decades of underinvestment in care has resulted in too many families, older adults, and disabled people struggling to access and afford care that meets their needs. The expirations of temporary provisions of the TCJA in 2025 give lawmakers an opportunity to enact tax policies that help all families thrive by supporting care investments, and caregivers in families with low and moderate incomes.
We urge you to allow the tax cuts for those with incomes above $400,000 to expire and to enact additional tax policies that would make the wealthiest households and big corporations pay more of their fair share. The revenues raised from fairer and more equitable tax policies should be used to invest in caregiving supports for families – including:
a child care guarantee,
federal paid family and medical leave, and
accessible and affordable aging and disability care,
with good jobs for all care workers
Care investments improve family well-being, support workers and employers, and foster economic growth, and would help support American families more than tax cuts for the wealthy and mega-corporations.
We also urge you to make the tax code work better for caregivers and families by expanding refundable tax credits, like making the Child Tax Credit fully refundable and permanent.
Using our tax dollars to invest in care supports families and caregivers, ensures disabled people and older adults receive the services needed to live and age at home with dignity, and builds an economy where all families can thrive.
Reforming the tax code is one of the most powerful tools we have to lower costs for families. Just as people across the U.S. need federal dollars for physical infrastructure like roads and bridges, we need care infrastructure, including child care, paid leave, and aging and disability care, for families to thrive. But today, tens of millions of working family caregivers, parents, disabled people, and older adults are forced to choose between getting the care they need and working to pay the bills.
The cost of inaction is too high for those who give and receive care. Our economy runs on care, but the lack of investments in care, caregiving, and care workers has left millions of people across the country to face impossible choices. For example:
A room in a nursing facility costs approximately $100,000 per year, and aging and disability care at home, where most people want to receive it, costs between $60,000 and over $288,000 per year. Nearly 700,000 older adults and disabled people are on waiting lists for Medicaid home and community-based services (HCBS) to receive essential, life-saving care.
In every state, families pay more for center-based child care than rent, and the average cost of child care for one child is more than $11,000 per year. In 2022, the lack of sufficient funding for child care left families in 11 different states on waiting lists.
The vast majority of workers in the private sector, more than 70 percent, lack access to paid family and medical leave.
The necessity of care, coupled with the overwhelming cost and the lack of access, means that 40% of adults, 105.6 million people, are family caregivers in the U.S. Unpaid care work, two-thirds of which is done by women, particularly Black and Asian women and Latinas, is worth more than 1 trillion dollars.
The lack of federal paid family and medical leave means workers in the U.S. lose $22 billion each year in lost wages alone, and the U.S. loses $122 billion annually in productivity and revenue due to the lack of child care. And while so much attention has been paid to inflation, the lack of investments in care has meant that inflation in care industries has outpaced overall inflation over the past decade. Policymakers have persistently refused to invest in care. As a result, the U.S. is a nation where everyone is in need of care, but only the wealthiest can truly afford it.
We can change course, build a system that values and supports all people touched by care – and build a stronger economy. By investing in child care, every $1 investment leads to a $7-$12 return in long-run benefits. Implementing paid leave results in double returns on the cost of investment for some businesses. Higher pay for direct workers adds billions to local economies. If women’s labor force participation were the same in the US as Germany and Canada, which have national paid leave and other family supports, it would mean more than $775 billion in additional economic activity annually. Investing in care supports a stronger, thriving economy.
Our tax policies favor the wealthiest and big corporations – those with the least need – at the expense of families, care workers, and people who need care. Caregivers, care workers, and people who need care did not meaningfully benefit from the 2017 Trump tax law.
The 2017 tax law overwhelmingly benefited the wealthiest and big corporations. Under the TCJA, the wealthiest 1% of households can expect an average benefit of $60,000 in 2025, while the majority, including most family caregivers, disabled people, and older adults will receive less than $500. Most care workers will average even less – only $70 per year.
For families and people who need care dealing with tens of thousands of dollars in care costs per year and care workers earning poverty wages, these scant benefits provide little relief. Moreover, the benefits to the wealthiest have neither trickled down nor been the boon to the economy that proponents of the law claimed it would be, as evidenced by the economic hardships faced by women, people of color, and families impacted by care. Growth of both employment and median wages slowed, and most low- and middle-income workers did not experience increases in wage growth.
Because the 2017 tax law was skewed to the wealthiest and big corporations, it has overwhelmingly disadvantaged women, people of color, care workers, caregivers, and care recipients. Because of both historic and ongoing systemic discrimination, disparities in wealth and income persist between women, especially women of color, and white men. For every dollar of wealth owned by a single white man, single Black women own 8 cents and single Latinas own 14 cents. Women are underrepresented among top earners, including because of the impacts of the lack of affordable, accessible child care, aging and disability care, and access to paid leave, and single women supporting single families on their own have the lowest median income among family households. Women make up nearly two-thirds of the workforce in the 40 lowest paid jobs, and these workers are disproportionately women of color.
The direct care workforce is overwhelmingly composed of women of color, and 94% of all child care workers are women. Despite the immense demand for a care workforce to meet the needs of millions of people who need care, care workers are among the most underpaid workers in the U.S. Direct care workers, who provide critical aging and disability care, are paid an average of just $25,000 per year, and child care workers are paid an average of less than $30,000. These workers are holding jobs that cannot be outsourced and will not be automated. Because of low wages and lack of benefits like paid family and medical leave, more and more workers are leaving both fields, increasing training and turnover costs for employers and diminishing the quality and consistency of care for families and individuals in need.
In addition, white tax filers represent 84% of tax filers in the top 10 percent of the income distribution in 2014, compared to 4.1% of Latinx tax filers and 2.8% of Black tax filers. Additionally, the TCJA’s changes to the Child Tax Credit provided more benefit to higher-income families rather than those with the lowest incomes. Under current law, an estimated 19 million children, including roughly 45 percent of Black children, do not fully benefit from the CTC. It is clear that the 2017 tax law made our tax code less equitable for many women and people of color.
The 2017 tax law hollowed out federal revenues, exploded the national deficit, and limited federal investments in care.
The evidence since the 2017 tax law was enacted shows that these tax cuts hollowed out federal revenues, exploding the deficit and limiting the fiscal space for federal investment in care. The TCJA added $2 trillion to the deficit and destabilized the debt-to-GDP ratio, leading to repeating debt crises. Moreover, the same policymakers who give trillions in tax cuts to the wealthiest argue that high deficits require cuts to programs and services that women, families, and caregivers rely on.
The U.S. collects fewer federal tax revenues and funds care infrastructure at lower levels, compared to international peers, and forces individual families to make up the shortfall. Underfunding leads to a broken care market, where families pay astronomical rates but care providers are severely underpaid and struggle to make ends meet. U.S. families’ freedom to make the best choices for them is limited by a severely constrained care infrastructure, especially compared to elsewhere in the world. But it doesn’t have to be this way.
Congress has a once-in-a-generation opportunity to set a new way forward with tax policies that support all people impacted by care and caregiving.
Rather than extend tax cuts for the wealthiest, lawmakers should get our fiscal house in order and support caregivers, care workers and families.
Expiring tax provisions from 2017 that primarily benefit the wealthiest families and big corporations should be allowed to expire, including but not limited to: returning the top income rate to 39.6%, ending the Section 199A pass-through deduction, and strengthening the estate tax. To take just one example, the temporary changes to the estate tax passed in 2017 significantly weakened the policy to only benefit the wealthiest families who have millions of dollars to pass on to their heirs. As it stands, very wealthy families can pass on $27.2 million to their heirs before owing any estate tax, meaning only a tiny fraction – less than .2% – of estates pay this tax. The families that struggle the most to find, provide and afford care, as well as the care workforce, are working to make ends meet, not seeking relief from the estate tax. They do not benefit from the increased thresholds passed in the TCJA, and if lower thresholds were allowed to resume, could well benefit from additional public dollars to invest. A stronger estate tax could act as a curb on dynastic wealth concentration and allow prosperity to be more broadly shared. Extending the 2017 estate tax parameters would lose $167 billion over ten years, while, in contrast, broader estate tax reform could raise significantly more revenue by asking more from those at the top.
Limiting the debate in 2025 to expiring provisions of the TCJA, however, would miss an opportunity to make the tax code fairer and raise additional revenue that would create more fiscal space for care investments. Lawmakers have numerous options of additional tax policies to advance this goal, such as raising the corporate tax rate, taxing income from wealth like income from work, and closing loopholes which allow well-off taxpayers to shrink their tax liability, such as the carried interest loophole and trusts used for tax avoidance. The corporate tax rate changes, for example, have been shown to primarily benefit owners, executives and top managers, with the bottom 90% of workers receiving little or no benefit. Care workers are some of the lowest paid in the workforce, and contrary to promises at the time of the TCJA’s passage, did not see their wages rise substantially after the TCJA was enacted. Raising the corporate tax rate could also raise trillions of dollars in revenue that could be used for care investments.
Lawmakers should also expand refundable tax credits so more low- and moderate-income families can access and benefit from them. It is well documented that the pandemic-era expansions to the Child Tax Credit (CTC), the Earned Income Tax Credit (EITC), the Child and Dependent Care Tax Credit (CDCTC) helped caregivers provide for their families and lowered poverty rates. In particular, full refundability of these tax credits is necessary to reach the lowest-income families, who may have fewer work hours or less income because they are caring for others. Restrictions on claiming the CTC for families whose children have Individual Taxpayer Identification Numbers should be allowed to expire, furthermore. Lawmakers should also extend Premium Tax Credits that allow low- and moderate-income families to afford health insurance, a vital lifeline particularly for households with aging or disabled family members. It is important to note that while these refundable tax credits are critical for families, they are not a replacement for the systemic investments in child care, paid family and medical leave, and aging and disability care described above that would support all of us when we need care.
Finally, lawmakers should robustly fund the IRS. Reducing IRS funding increases the deficit, as the agency is unable to collect the taxes that are already owed based on the laws on the books. Low- and moderate-income families with caregiving responsibilities are unlikely to have sophisticated tax returns prepared by lawyers who can wage expensive legal battles over tax liability. A properly funded IRS works against lawbreaking by the ultrawealthy and corporations, which robs the public of hundreds of billions of dollars per year. The IRS has already stepped up its enforcement at the top, including auditing millionaires who did not even file returns in prior years. These and other efforts have resulted in the collection of more than $1 billion in unpaid taxes to date.
Restoring the full Inflation Reduction Act funding for the IRS, and adding additional mandatory funding, would continue these efforts, raising an estimated $341 billion over 10 years which could be invested in care.
Conclusion
The 2025 tax debates are a once-in-a-generation chance to move us closer to a tax code that supports care workers, caregivers, and people who need care, most especially those in low and moderate-income households. Unlike many provisions of the TCJA, which were skewed to benefit the wealthiest households and big corporations, care and caregiving investments support all of us, not just those at the top, and grow the economy. Reversing the tax-cutting trend would raise more public dollars and allow us to make the investments families need. The way to support families and caregivers is to make tax policies work better for them, and use revenues to invest in them, not extend tax breaks for the wealthiest and big corporations that never “trickle down.”
Thank you for the opportunity to comment to the Ways and Means tax teams. For additional information or questions, please contact Tory Cross at tory@caringacross.org or (510)421-9652.
Sincerely,
National Women’s Law Center
Caring Across Generations
MomsRising
9to5 GA
Abortion Access Front
Alliance for Quality Education
American Federation of Teachers (AFT)
American Muslim Health Professionals
Americans for Democratic Action (ADA)
Americans for Tax Fairness (ATF)
Arkansas Community Organizations
Association of University Centers on Disabilities
Autistic Self Advocacy Network
Brighter Beginnings
California Child Care Resource & Referral Network
Campaign for a Family Friendly Economy
Care in Action
Cedar Lane Unitarian Universalist Congregation Environmental Justice Ministry Center for Economic and Policy Research
Center for Independence of the Disabled, New York (CIDNY)
Center for Law & Social Policy
Childhood Obesity Initiative
Children's HealthWatch
Coalition on Human Needs
Common Good Iowa
Community Change Action
Congregation of Our Lady of Charity of the Good Shepherd, U.S. Provinces Congregation of Sisters of St Joseph
DC Action
Economic Security Project Action
Equal Rights Advocates
Equitas Health
Excessive Wealth Disorder Institute
Fair Share America
Family Values at Work
Family Values@Work Action
Five Corner Cupboard Food Pantry
Futures Without Violence
Georgia Values Action
Grand Street Settlement
Hawaii Children's Action Network Speaks!
Health Care Voices
Hunger Free America
Idaho Hunger Relief Task Force
Immigrant Service Providers Group/Health
Indiana Justice Project
Indy Hunger Network
Iowa Citizen Action Network
Iowa Citizen Action Network
Just Harvest
Justice in Aging
La Colaborativa
Lafayette Urban MInistry
Legal Momentum
Lion of Judah Enterprises
Little Listeners LLOTC
Logic Homeschool
Low Income Investment Fund
Maternity Care Coalition
Metro New York Health Care for All
Mississippi Early Learning Alliance
MLPB
MoveOn
National Advocacy Center of the Sisters of the Good Shepherd
National Asian Pacific American Women's Forum
National Association for Family Child Care
National Council of Jewish Women
National Council of Jewish Women, Greater Philadelphia Section
National Domestic Workers Alliance
National Education Association
National Partnership for Women & Families
National Respite Coalition
Nebraska Appleseed
Nebraska For Us
NETWORK Lobby for Catholic Social Justice
Oxfam America
Paid Leave for All
ParentsTogether Action
People Power United
Poder Latinx
Private Citizen
Project Guardianship
Public Advocacy for Kids (PAK)
Reproductive Freedom for All (formerly NARAL Pro-Choice America)
RESULTS/Silicon Valley
Service Employees International Union (SEIU)
Shriver Center on Poverty Law
Sisters of Mercy
Southern women in motion
State Revenue Alliance
Supermajority
The Arc of the United States
The Expectations Project
The Family Conservancy
The National Domestic Violence Hotline
Unitarian Universalists for Social Justice
United Church of Christ
United Way of Mid Rural New York
VOICES for Alabama's Children
Voices for Progress
Voices for Virginia's Children
Women Employed
WZA Consultant
Young Invincibles
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