Connecticut Lawmakers Propose Refundable Child Tax Credit

CONNECTICUT — State legislative leaders are advocating for the establishment of a refundable child tax credit, citing financial relief for families and potential economic benefits.

House Speaker Matt Ritter (D-Hartford), Senate President Martin Looney (D-New Haven/Hamden), Rep. Kate Farrar (D-West Hartford/Newington), and Rep. Antonio Felipe (D-Bridgeport) held a press conference Wednesday ahead of a public hearing on two proposed bills—House Bill 5986 and Senate Bill 740—both of which would create a refundable child tax credit against the state's personal income tax.

Supporters of the proposals argue that the tax credit would provide direct relief to families facing high costs of living. Ritter said the measures would help working families manage expenses and offer needed financial support.

Looney emphasized the role of Senate Bill 740 in supplementing the state's Earned Income Tax Credit, calling it an effort to improve affordability for families with children. He reiterated his support for the bill, stating that it is a step toward ensuring financial stability for households across the state.

Farrar pointed to rising costs for working families and described the tax credit as an effective tool to improve affordability and stimulate the economy. She noted that nearly 70 House Democratic members are sponsoring House Bill 5986, indicating broad legislative support for the measure.

Felipe said the proposal aims to address unmet needs of working families and described the introduction of a permanent refundable child tax credit as an important step toward economic security.

According to lawmakers, Connecticut ranks among the most expensive states for raising a child, with nearly 40 percent of families struggling to meet basic financial needs. Additionally, Connecticut is the only high-cost-of-living state with a broad-based personal income tax that does not adjust for the number of children or childcare expenses.

Proponents of the tax credit estimate that more than 550,000 children in the state would benefit. They also cite economic studies suggesting that for every $1 in child tax credits, families spend approximately $1.38 in the local economy.

House Republican Leader Vincent Candelora, who represents the 86th General Assembly District, called the "irony" in the Democrat lawmakers' proposal "unmistakable:"

"Democrats push a $600 tax credit while lamenting the struggles of working families, yet they’re the ones who’ve made Connecticut so expensive. They’ve hiked taxes, ignored soaring electric rates, and now want to hand out even more money at the expense of hardworking taxpayers."

Candelora also rejected Democrats' claim that Connecticut isn’t competitive in the administration of benefits:

"Surrounding states offer child tax deductions—just as Republicans have proposed here—but Connecticut already offers the more generous EITC program. Our state provides extensive assistance beyond that, too, but our budget—and taxpayers—have reached the breaking point. We simply can’t afford their endless giveaways."

The Finance, Revenue & Bonding Committee is expected to review the proposals during its public hearing.