White House says child tax credit should boost economy, offset unemployment phaseout
The Biden administration expects the start of child tax credit payments in July to provide a solid boost to the U.S. economy that should more than offset a halt in extra unemployment benefits by 25 states, a White House official said on Tuesday.
Half the U.S. states are dropping an extra $300 in unemployment benefits in coming weeks, citing concerns that the funds were contributing to labor shortages in some sectors.
The White House official said the moves would have only a short-term impact on spending, and said President Joe Biden’s COVID-19 relief plan was always intended to end when no longer needed.
The child tax credit payments, which will reach millions of American households in July, including 88% of children in the country, would have a more lasting impact in reducing childhood poverty and boosting future earning potential, the official said, underscoring Biden’s push to make the payments permanent.
The overall outlook for the U.S. economy looked bright, the official said, citing upbeat forecasts from the World Bank and Organization for Economic and Cooperation and Development that foresee growth of nearly 7% for 2021.
Reference: Reuters
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