Memo: Proposed child tax credit good for Ohio, economy | Ohio

(The Center Square) – Ohio Gov. Mike DeWine’s proposed child tax credit would give $450 million directly to Ohio families and add more than $700 million to the state’s economy, according to a new memo from an independent analysis group.

Scioto Analysis, a Columbus-area policy analytic group, recently released its memo that said the impact would be seen primarily among low- and middle-income families.

“There is a robust body of research that shows how investments made in early childhood are beneficial both to the families who receive them and the broader community,” Scioto Analysis Principal Rob Moore said. “Children who grow up with access to more resources have an easier time in the short term, which often translates to better wage, health, and criminal justice system involvement outcomes later in life.”

DeWine proposed the tax credit when he launched his two-year budget plan earlier this month. It would phase out at designated income levels, giving working parents with a full-time minimum wage job a $1,000 credit through age 6 of their child.

To pay for it, DeWine wants to increase the state’s cigarette tax from $1.60 to $3.10 per pack.

“The child credit we are creating is totally funded with the increase in the cigarette tax,” DeWine said. “It’s a thing that makes a lot of sense as far as public health and as far as families.”

Scioto Analysis used previous literature on the relationship between tax credits and outcomes for households to estimate the proposed credits would grow the state economy by $740 million, with $450 million of direct credits going to Ohio families.

It also believes the credit would produce $500 million in higher future earnings for children receiving it and another $190 million in reduced crime costs.

According to Moore, those numbers are based on research from the Columbia University Center on Poverty and Social Policy that showed financial support for families with children leads to better health outcomes, better education success and lower crime.

“Investing in Ohio children is a good bet for growing Ohio’s economy in the long run,” Moore said.