Even multiple tax credits are unsustainable, can’t solve poverty in the ort or long term
Javier Balmaceda, Senior Policy Analyst on Puerto Rico, “Tax Credit Expansions Expected to Significantly Reduce Poverty in Puerto Rico”, Center on budget and Policy Priorities, March 14 2022, https://www.cbpp.org/blog/tax-credit-expansions-expected-to-significantly-reduce-poverty-in-puerto-rico, NSH-NT
It’s worth noting that while the fix for the Child Tax Credit’s family-size exclusion is permanent, the national expansion of the credit is only temporary. Congress should therefore act to make full refundability of the credit permanent as well as additional improvements in the credit. If they don’t, the credit’s anti-poverty effects in Puerto Rico (and elsewhere) will surely decline.
It’s also important to note that families in Puerto Rico claiming the Child Tax Credit must do so directly with the IRS, whereas they can claim the EITC through Puerto Rico’s Treasury Department. Given the historical absence of these credits in Puerto Rico and the novelty of the expansions, uptake is expected to build gradually over time. Intensive outreach efforts, including campaigns from EA and YDI, will help as many families as possible take advantage of these credits.