Graphic of the week: Child tax credits and child poverty

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Data included in a recent HPIO data snapshot shows that a federal expansion of the child tax credit (CTC) led to a sharp drop in child poverty, as illustrated above.

HPIO released a new data snapshot last week titled "Effects of the Child Tax Credit on Poverty, Health and Well-Being" that highlights the potential impact of increased, refundable child tax credits.

Tax policies are powerful tools for reducing poverty, promoting financial security and improving population health. The 2021 American Rescue Plan Act increased the federal Child Tax Credit (CTC) amount and made it fully refundable. The expansion expired at the end of 2021, returning the credit amount to pre-pandemic levels.

Gov. Mike DeWine’s biennial budget proposal calls for a refundable $1,000 CTC for eligible families with children 6 years old and under, funded by an increase in cigarette tax revenue.
 
The federal CTC expansion led to a drop in national child poverty by 55% in 2021, with deep poverty (income less than half of the federal poverty level) and extreme poverty (living on $2 or less a day per person) effectively eliminated. After the expansion expired in January 2022, child poverty spiked by 41% nationally. Census data also shows a drop in child poverty rates in Ohio during 2021.

The publication page also includes a link to download the graphics from the snapshot to use in your work or to share on social media.