The House greenlights significant bipartisan tax legislation aimed at broadening the child tax credit and providing incentives for businesses.

On Wednesday, the House approved a bill in a rare display of bipartisan unity, expanding the child tax credit and extending certain business tax credits despite the prevailing political divisions. The legislation, titled the Tax Relief for American Families and Workers Act of 2024, secured an overwhelming 357 to 70 vote, comfortably surpassing the required two-thirds majority. A total of 188 Democrats joined forces with 169 Republicans in favor, while 23 Democrats and 47 Republicans opposed the bill. The next step is Senate consideration.

This bill focuses on enhancing the child tax credit to offer relief to lower-income families, though it is less robust than the pandemic-era version that significantly reduced child poverty and concluded in 2021. Democrats view this as a positive stride, seeking to reinstate the assistance. The proposed changes would simplify qualification for the child tax credit, elevating the amount from $1,600 per child to $1,800 in 2023, $1,900 in 2024, and $2,000 in 2025. The legislation also includes adjustments for inflation in subsequent years, potentially lifting over half a million children out of poverty, according to the Center on Budget and Policy Priorities.

In addition to these family-focused measures, the bill reintroduces tax cuts for businesses, including deductions for research and development. This aspect appears to have garnered support from congressional Republicans, mitigating reservations about expanding the child tax credit and granting the Biden administration a significant victory in an election year.

House Ways and Means Committee Chairman Jason Smith and Senate Finance Committee Chairman Ron Wyden unveiled the bipartisan agreement, emphasizing its common-sense approach and its potential to enhance financial security, stimulate growth, and strengthen communities.

The House expedited the voting process through a suspension of the rules, utilizing a floor vote requiring two-thirds approval to sidestep potential procedural obstacles. This strategy bypasses the need for a rule vote, a step that has proven contentious in recent months due to conservative opposition, hindering the legislative process.

Despite recent challenges, the bill received widespread support, even from moderate Republicans who initially employed procedural tactics in protest. Speaker Mike Johnson expressed his backing for the legislation, lauding it as an essential bipartisan initiative that revitalizes pro-growth tax reform while discontinuing a costly COVID-era program. Johnson commended Chairman Smith for steering the bill through committee with confidence, highlighting the bottom-up legislative process as a positive example of congressional lawmaking.