Child care may soon become more affordable for some working families in Pennsylvania.
The Pennsylvania House of Representatives passed the resolution by a bipartisan 155-47 vote Bill that would provide tax breaks to employers who contribute to their employees’ child care expenses.
“We need access to child care to ensure a functional economy because without access there is no workforce, no tax revenue and our economy stagnates,” said state Rep. Liz Hanbidge (R-Montgomery), who sponsored the bill. with state Rep. Morgan Cephas (D-Philadelphia), said in a speech on the House floor.
According to a release from House Democrats, “the proposed tax credit is equal to 30% of the total contributions an employer makes to child care for all of its employees, counting only the first $500 in contributions made per employee.”
The announcement also indicated that the relief will not be recognized as income in employees’ personal income tax returns.
In her speech, Hanbidge criticized what she called “inadequate wages” for child care workers in Pennsylvania, attributing deficiency such workers on low wages. The U.S. Bureau of Labor Statistics last year set the average hourly wage for child care workers in Pennsylvania at $14.18 an hour, $1.24 less than the national average.
“While this bill is a modest step in alleviating some of the impact of the lack of child care on families and businesses, it is an important one,” Hanbidge said. “By forming partnerships with employers who are willing to help cover the important costs of employee care, we are better able to strengthen our economy and strengthen our future.”
Hanbidge noted that the U.S. economy loses up to $122 billion a year due to inadequate child care, an apparent reference to test by a nonprofit organization in Washington A ready nation. This study was funded by the Pritzker Family Foundation, which it says website“is committed to and focused on social and economic justice and equality.”
U.S. Chamber of Commerce, Vol October reportestimated that Pennsylvania loses $591 million in tax revenue annually “due to child care issues.”
At the end of her speech, Hanbidge received thunderous applause and the bill was passed without debate. The measure now goes to the Republican-controlled Senate.
Two states neighboring Pennsylvania, West Virginia AND New York, already provide incentives to companies that help employees with childcare costs or provide childcare. Similar proposals are being considered, among others: Alabama, Connecticut AND Wisconsin.
The bill’s passage follows Pennsylvania’s expansion Child care tax credit, which Gov. Josh Shapiro signed into law in December. The measure also received bipartisan support.
