(The Center Square) – A group of Ohio economists believe a state child tax credit would lead to millions in state benefits in the form of increased future earnings for children and reduced entitlement spending.
Scioto Analysis, a fiscal policy analytic group based outside Columbus, recently released a cost-benefit analysis of the impact of the state child tax credit, concluding it would generate between $60 million to $300 million in net benefits.
In addition to the federal child tax credit, 12 states have child tax credits of varying levels and availability, with credit amounts ranging from $100 to $1,000.
The group said a November 2022 Census Bureau report found the federal child tax credit expansion in 2021 lifted 2.1 million children out of poverty.
“The expansion of the federal child tax credit in 2021 was the most significant antipoverty policy change in the United States since Lyndon B. Johnson’s Great Society,” Scioto Analysis Principal Rob Moore said.
According to the analysis, most of the benefits of a state child tax credit would be realized as increases in future earnings for children who qualify for the tax credit today.
Their report also said there are social benefits in the form of reductions in future crime and healthcare expenses.
“Programs like this that reduce child poverty are not just Band-Aid fixes that help people get by today, they are investments in the future that have major positive impacts for society,” said policy analyst Michael Hartnett. “Everyone in our society, even those who never see a dollar of this tax credit, stand to receive major benefits.”
