Many experts feel that the US could help solve its perennial poverty problem with a Universal Basic Income. The closest the federal government came to such a concept was with the expanded version of the Child Tax Credit stimulus check.
Even as federal and state stimulus checks dry up in the US, some states, cities, and counties continue to advocate the concept of universal basic income. No country has yet introduced a universal basic income sufficient for basic essential needs. But some local and state bodies are seriously considering the idea and have gone for pilot projects to test the ground for a more comprehensive scheme.
The Child Tax Credit was first established in 1997 and was doubled initially to $2,000 a year for each child in 2017 under the Tax Cuts and Jobs Act of 2017. When the Child Tax Credit stimulus check was expanded again under the American Rescue Plan Act signed by President Biden in March 2021, it changed the whole social and economic situation for parents.
At a time when the COVID-19 pandemic worsened the financial situation of millions of households, the decision by the Biden administration was not to add to the amount of the tax credit. It converted the payment from a lump sum amount given only at the end of the tax year against the income Tax Rebates to advance monthly payments. Further, it abandoned the work requirement for benefiting families, which was a mainstay of the earlier version of the stimulus check.
This bold move had an immediate effect on American society. The families of one-third of the children in the US immediately felt the change in their lives. This included 52% of all Black children and 41% of all Hispanic children whose families were formerly excluded. These families earned too little and did not have to pay income tax. So they were disqualified from claiming the Child Tax Credit stimulus check.
The Tax Rebate expansion moved 3.7 million children and their families out of the clutches of poverty in the six months when the CTC stimulus checks payments were made. These monthly checks gave between $250 to $300 per month per child. The difference in amount was due to parents of children aged below 6 years receiving $3,600 against $,000 for children between 6 and 17 years.
This support on the one hand immediately reduced starvation and malnutrition among children. It also ensured a free hand for parents as they looked for better jobs without worrying about putting food on the table the next day.
The expanded stimulus check and tax rebate was a resounding success and is considered one of the most successful schemes ever by the federal government. But the expiry of the expanded child tax credit stimulus check after the first quarter of 2022 pulled back many of the families back into the same situation. The economic situation in the US had not improved much in this period and unemployment continued to be dangerously high.
Both experts and the Biden administration consider the Child Tax Credit stimulus checks as one step towards the concept of a universal basic income. This could eliminate poverty while at the same time not affecting unemployment figures. Around 37.9 million families in the US are in poverty. The provision of a federally backed monthly payment that will reach every individual would without doubt lift them out of poverty.
It would more importantly provide millions of American children a better chance at improved health, a decent education, and the prospect of between wages in the future.
The poverty figures remain extremely high at 11.6% percent, close to the figures of many developing nations. This child tax credit stimulus check would benefit millions of individuals and families and also save hundreds of billions of dollars as it would rescue the social costs of poverty in the US.
But the question persisted even among the Democrats; would the President manage to ultimately convince our legislators that poverty cannot be considered a moral failing? It is instead a social condition that can and should be advancing a universal income floor below which no one should be allowed to sink.
The Universal Basic Income concept is being tried out at various levels of the administration, mostly in Democrat-ruled bodies including state county, and city levels.
Pennsylvania Among States Trying Out Another Round Of Stimulus Checks
In Pennsylvania, the elderly and the disabled are to receive stimulus checks and tax rebates through the Pennsylvania Property Tax and Rent Rebate program. This scheme is to provide relief to qualified applicants. There are rebates on offer ranging from $250 to $975.
This scheme is annually available to residents of the Keystone State. The program is designed to alleviate the additional burden of rent. Expenses and property tax, especially on low and moderate-income individuals and households.
Qualified individuals are to receive a stimulus check or a tax rebate of up to $650. Homeowners who conform to extra criteria will be eligible for supplemental rebates of up to $975.
It is vital to note that the deadline for this state-sponsored program is June 30. Following the submission of applications, the rebates will be considered and processed promptly. The distribution is set to commence as early as July 1.
Qualifying For The Pennsylvania Tax Rebate
The Pennsylvania state tax rebate program is for residents who are at least 65 years old. Widowers and widows aged fifty and above also qualify. Individuals who are disabled and aged eighteen or more also qualify under this scheme.
The income limit for homeowners is $35,000 a year while for renters it is $15,000 annually. For Social Security recipients, 50% of the payments are exempted for the sake of calculation.
The terms are also flexible as claimants who have stayed even one day in the claim year but meet other eligibility criteria may file claims for tax rebates. Even spouses, estates, and personal representatives may file claims on behalf of the claimants.