Simply raising tax credit on children would help a lot in the US. It also should not be progressively reduced like other tax credits do with income, as it is disincentivizing successful people from procreating.
I like the idea of increasing the child tax credit to something like $10-15k per child, up from the current level of a few thousand. The increased incentive would only be fully realized by families who could scale their income up to match. Based on what I see and hear from my peers it seems like many middle class couples are on the fence (financially) in terms of having ''one more kid'' and this could help close the gap.
I think tax credits already accomplish this to a degree. The poor are more likely to have children, and they can already claim those children for tax credit, for example.
just increase the tax credit for kids, even make it progressive so you get bigger tax credits for more kids so higher income families have more reason to have more kids. The welfare cliff as it currently stands will doom our country, in my friends and family group the ones who are unemployed or work low income jobs have more kids than the rest combined and no reason to strive to do better because unless they make 6 figures they are better off doing the minimum.
systems are about incentives and our current system in the US has us in a death spiral, immigration is used as a short-term stopgap to reduce impact of low birth rates but just accelerates the death spiral in the long term
I would have had more children if childcare was more heavily subsidized. Make it a tax deduction up to a fraction of the amount you pay in taxes to keep it from incentivizing those without financial means to have children.
What I mean by that is using a deduction, not a credit. You aren’t paying people to have kids but rather incentivizing people that are financially independent by lowering their current tax burden while they have kids <18. Their surplus of kids will more than make up the tax revenue down the road.
For poor people you continue to focus on helping with basics (food and shelter), family planning measures, and up-skilling towards becoming independent. Since a deduction probably isn’t helpful in these cases, a tax credit would continue to exist.
It seems that you only get $1000 tax credit per child. That probably eases the burden on people who are going to have children in the first place, but is still net negative and doesn't do anything for people who aren't going to have children.
An incentive for everyone to have children doesn’t make sense. An incentive for hard working, intelligent people to have children makes more sense. Make it a tax deduction, so those making six digits are encouraged to have more than two children, while those barely able to survive aren’t perversely incentivized to spread their unsuccessful genes.
That's a regressive tax that punishes people who are unable to have children due to health problems, sexual identity, living conditions, or even failure to get laid. People who do have children should be taxed more instead because they're more successful, and they're the ones who benefit from higher taxes anyways due to publicly-funded education and social programs.
We can disincentivize it substantially by replacing tax benefits for having kids with tax burdens for having kids, promoting family planning and making contraceptives free and easily accessible as possible, making childbirth and childrearing as expensive as possible, etc.
Fortunately tax policy can be adjusted to encourage things you want to happen within a society. If taxes are punitive, tax credits for having children would lead to a baby boom based on the same logic.
Maybe a policy like this might work: for every child you have, you get a lifetime 10 percentage point reduction in income tax rates.
Suppose the top rate is 37%. Have one child, now for the rest of your life, your top rate is capped at 27%. Have a second child, now your lifetime top rate is capped at 17%. Third child, capped at 7%. Fourth child, never pay income tax ever again.
But, a lot of people will object to such a policy. Childless people will end up having to pay higher taxes as people with kids pay lower or no taxes–some may accept that as their personal sacrifice for the greater good, many likely won't. Others will object to the fact that the biggest benefit is going to be for the middle and upper classes – who are most likely to pay the higher tax rates – while having far less benefit for those on low incomes, who pay little or no tax already. There is the (difficult to quantify) risk that unsuitable parents may end up having kids just for the tax benefits, and then mistreat/abuse those kids. Given all these objections, I'd be surprised if it ever actually gets adopted. But, in terms of increasing TFR in wealthy countries, it might actually work.
It's expensive to have kids these days. Many would-be parents are holding off, and for good reason - at the same time, income inequality is at an all-time high since the great depression.
The government should fix this in tax laws or directly assist if they want more kids (at a moderate salary, the child credit disappears and AMT calc essentially kills your deductions).
tax rebates -aka a tax deduction for each child already exists. this passes the tax burden to people without kids, and is also unfair. rebates would also be unfair. a child is not a rebate. what i don't get is why a child is treated as a child for taxes.
a tax return should be for the family -a joint return. you take wife+husband+kids. you add up all the salary. and you divide by number of tax payers. exactly how a joint return is now, but count kids.
this puts you in a much, much lower tax bracket, and saves you more than a rebate or dependent. it is actually unfair in my opinion to do it another way, and has nothing to do with babies. your family household just pays taxes on its income. and without various programs designed to steal from people without kids. and that's what maternity leave is -stealing.
- Grant tax incentives or write offs for children born. It'd be incredibly unfair and unconstitutional to scale with kids' grades due to socioeconomic backgrounds being a major factor, but perhaps educational expenses can be subsidized. Or maybe we should just put more money into early education.
- Make family leave a mandatory benefit for parents of all children, born or adopted.
- Open up to immigration. Don't shut it down. This seems like the simplest solution.
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