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Joint Economic Committee Democrats

Issue Briefs

Aug 02 2021

Expanded Child Tax Credit Will Inject More Than $18.6 Billion Into Local Economies Each Month

In July 2021, monthly payments from the newly expanded Child Tax Credit (CTC) started hitting families’ bank accounts. The American Rescue Plan (ARP) dramatically increased the value of the CTC, from $2,000 per child to up to $3,600 per child under six and $3,000 per child six and older. The ARP also expanded the CTC so that it is now fully refundable and previously ineligible low-income families will receive the full credit. Half of the expanded CTC will be distributed via monthly payments, helping families meet their financial needs in real time. The first round of monthly payments distributed nearly $15 billion to families across the United States, averaging $423 per qualifying family and reaching more than 59 million children.

Jul 15 2021

Unemployment Insurance, Worker Power and the Recovery

Economic indicators show that the labor market is experiencing a period of rising wages and more job choices for workers as Americans continue to recover from the economic effects of the COVID-19 pandemic. Research indicates that the scale of the impact of government programs like Unemployment Insurance (UI) on the timing of workers’ return to work is small to negligible. Real-time evidence and broad academic consensus suggest that the labor market is returning to its pre-pandemic tightness, countering claims by proponents of a “labor shortage.” Before the pandemic, wages were rising and workers had more choices for jobs that fit their skills and needs as the labor market tightened.

Jun 17 2021

Investing in the IRS to Close the Tax Gap

In April 2021, IRS Commissioner Charles Rettig estimated that the tax gap—the difference between the taxes that are owed and the taxes that are actually paid—“could approach and possibly exceed $1 trillion” each year.1 Commissioner Rettig attributed much of the growing tax gap to the lightly regulated cryptocurrency sector, foreign-source income and the abuse of passthrough provisions.2 As some taxpayers continuously develop ever more sophisticated methods of tax evasion, it has become increasingly difficult for the IRS to maintain strong enforcement efforts, particularly as its budget and staffing levels have been slashed in recent years.