WASHINGTON–The Concord Coalition Citizens’ Council today urged
Senators to oppose any attempt to remove the "Kidsave" mandatory
savings tax credit from the tax bill currently before the Senate.
The Kidsave mandatory savings measure, authored by Sens. Bob
Kerrey (D-Neb.) and John Breaux (D-La.), would allow a $500 tax credit
for each child between the ages of 13-16, only if parents invest the
money in a qualified retirement account in their child’s name. Under
the plan, a portion of the savings could be withdrawn tax free for
college tuition and fees.
WASHINGTON–The Concord Coalition Citizens’ Council today urged
Senators to oppose any attempt to remove the "Kidsave" mandatory
savings tax credit from the tax bill currently before the Senate.
The Kidsave mandatory savings measure, authored by Sens. Bob
Kerrey (D-Neb.) and John Breaux (D-La.), would allow a $500 tax credit
for each child between the ages of 13-16, only if parents invest the
money in a qualified retirement account in their child’s name. Under
the plan, a portion of the savings could be withdrawn tax free for
college tuition and fees.
"Even though Concord has consistently opposed any tax cut while
the nation is still running budget deficits and the government must
borrow money to finance the tax cuts, we believe Kidsave is far
superior to a straight $500 per-child credit," said Concord Executive
Director Martha Phillips. "In our view, a no-strings child tax credit
is a cruel hoax on the very children who are supposed to benefit from
it."
Under the straight $500 per-child tax credit supported by
opponents of Kidsave, their would be no limits on how parents could
spend the tax credit.
"Without Kidsave, there is no guarantee that the tax credit
would be used for a child’s benefit," Phillips said. "Even if the
entire $500 tax credit was efficiently invested in children, it would
merely offset an equal amount of government debt caused by the tax cut.
Children would eventually shoulder the burden of that extra government
debt through higher tax rates, lower retirement benefits and a lesser
economy."
"At least under Kidsave, it would be clear who the
beneficiaries are," Phillips said. "We wouldn’t be creating a new
entitlement for parents at the expense of their children."
