Experts warn that the cost of the bipartisan Tax Relief for American Families and Workers Act, which includes the Child Tax Credit expansion, may rise to an astounding $1.5 trillion over the course of ten years. Senior policy expert at the Tax Foundation Garrett Watson emphasizes the long-term financial consequences should the temporary provisions become permanent, possibly necessitating extra offsets to prevent deficit rises.

Child Tax Credit Expansion: Potential Long-Term Costs Unveiled

The Joint Committee on Taxation (JCT) has initially scored the bill’s temporary provisions at around $80 billion. However, Watson reveals that if policymakers opt for permanency, the price tag could skyrocket between $700 billion and $1.5 trillion over the next decade, depending on factors such as the inclusion of the current law Child Tax Credit (CTC) in a permanency package.

A recent analysis by the Committee for a Responsible Federal Budget (CRFB) estimated the potential cost at $650 billion, with concerns raised by some Republicans about the bill’s “pay for” provision and its perceived budgetary impact.

Disagreements within the Republican party emerge, with conservatives questioning the effectiveness of the “pay for” provision and proposing alternatives, while the House Freedom Caucus emphasizes concerns over the bill’s expansion of the CTC, particularly its application to illegal immigrants filing tax returns.

READ ALSO: Walgreens in Massachusetts Accidentally Charges Tax on Grocery Essentials, Urges Customers to Check Receipts for Refunds

Child Tax Credit Expansion: Contentious Issues and Opposition

The tax package faces resistance from some Republicans who view the “pay for” provision skeptically, favoring the elimination of Biden-era green energy tax breaks to save taxpayer funds.

Contentions over the package extend to issues like the extension of rules from Trump-era tax reform, impacting illegal immigrants’ eligibility for the Child Tax Credit, and the persistence of the $10,000 cap on the State and Local Tax Deduction (SALT), prompting opposition from members of the bipartisan SALT Caucus.

READ ALSO: Money Matters: The $12,076 California Tax Rebate – Are You Eligible?