[Congressional Record Volume 144, Number 61 (Thursday, May 14, 1998)]
[Senate]
[Pages S4906-S4907]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]

      By Mr. SMITH of Oregon (for himself, Mr. Hatch, Mr. Grams, Mr. 
        Abraham, Mr. Wyden, and Mr. Hutchinson):
  S. 2079. A bill to amend the Internal Revenue Code of 1986 to replace 
the dependent care credit for children age 5 and under with an increase 
in the amount of the child tax credit for such children; to the 
Committee on Finance.


                      child tax credit legislation

  Mr. SMITH of Oregon. Mr. President, colleagues, and ladies and 
gentlemen, I rise today to introduce legislation to change the Tax Code 
to put stay-at-home moms and dads on an equal footing with two-income 
families. My legislation is cosponsored by Senators Hatch, Grams, 
Wyden, and Abraham. This legislation that we introduce will

[[Page S4907]]

increase the current $500-per-child credit to $1,500 per child for 
children up to 6 years of age. This credit would replace the current 
dependent care tax credit with real money that directly benefits 
families and restores equality and fairness in child care.
  Mr. President, there are many proposals to reduce tax burdens, many 
of which I wholeheartedly support, such as the elimination of the 
marriage penalty. But I must confess some frustration that I felt on 
the night our President gave his State of the Union Address when he 
spoke at great length about child care. He made a proposal, about $20 
billion worth, that contained many laudable provisions and parts of 
which I could support. But it contained a very glaring omission, in my 
view. The Clinton administration policy is both a direct and indirect 
subsidy to the marketplace day care industry. The administration seeks 
to help only a small portion of working parents, ruling out those who 
wish to stay at home to take care of their child and those who do not 
want to use marketplace day care. Government policy ought not to 
discriminate in this manner against the best form of child care where 
the child is taken care of by his or her own parents or family member.
  A few months ago Renee Anderson of Medford, OR, sent me an e-mail 
commenting that government spending will not give tax relief to parents 
of preschoolers who take care of their own children.
  Here is her letter, Mr. President. I ask unanimous consent it be 
printed in the Record.
  There being no objection, the letter was ordered to be printed in the 
Record, as follows:

                                                  Medford, OR,

                                                    March 7, 1998.
     Re the President's National Day Care Plan.

       Dear Senator Gordon Smith: Please do all you can to squelch 
     Bill and Hillary Clinton's $21.7 billion National Day Care 
     Plan.
       It is loaded with a number of government-controlled 
     programs.
       New spending will not give tax relief to parents of 
     preschoolers who take care of their own children.
       Not one penny of relief will help increase the amount of 
     time parents will have available to spend with their 
     children.
       This is ``day care,'' not ``child care.'' Child care is 
     something that every family does. Day care is the activity, 
     undertaken out of preference or necessity, that some families 
     choose.
       There is a rampant prejudice against stay-at-home parents.
       Here's what's at stake: the continued importance of 
     parental care of children and through that care, passing on 
     the values that families hold dear.
       Commercial day care is often avoided if at all possible 
     because there is a lack of personalized attention and 
     affection. Plus there is a greater exposure to childhood 
     diseases and many other sicknesses.
       Surely this new public policy is very characteristic of 
     today's government arrogance.
       I strongly oppose this $21.7 billion national day care 
     plan. It is an alarming example of government encroachment.
           Sincerely,
                                                   Renee Anderson.
  Mr. SMITH of Oregon. Renee, like many mothers and fathers, sees most 
government spending as ``day care'' and not ``child care.'' Child care, 
she says, is something that every family does. Day care is the activity 
undertaken out of either preference or necessity that some families are 
able to choose or forced to choose.
  A recent Wirthlin poll shows that care by a child's own parent or 
immediate family member is rated as the most desirable form of child 
care, with child care by a family's mother ranking the highest.
  Census Bureau statistics show that many families--nearly half of 
those with children under 6 years of age--pass up a second income and 
care for their children themselves, and yet where is the tax relief to 
help ease the burden of child care expenses for families that choose to 
take care of their children in their homes? It simply is not there. 
This legislation will eliminate the current discriminatory tax policy 
and replace it with one that is fair to all families regardless of the 
child care choices they make.
  I hope many of my colleagues can join in supporting this legislation. 
I know it competes with many other proposals, but I, frankly, can think 
of no greater priority that we ought to have than helping mothers and 
fathers take care of their children, for truly the hand that rocks the 
cradle is the hand that controls the future. There is no more important 
responsibility that any of us as mortals undertake than to rear a 
child. So the Federal Government ought to not get in the way of that 
but ought to reduce its take and leave more resources to mothers and 
fathers to leave them at home where they can serve real human and child 
needs.
  Mr. President, I ask unanimous consent that the text of the bill be 
printed in the Record.
  There being no objection, the bill was ordered to be printed in the 
Record, as follows:

                                S. 2079

       Be it enacted by the Senate and House of Representatives of 
     the United States of America in Congress assembled,

     SECTION 1. REPLACEMENT OF DEPENDENT CARE CREDIT FOR CHILDREN 
                   UNDER AGE 6 WITH INCREASE IN CHILD TAX CREDIT.

       (a) Increase in Child Tax Credit.--Subsection (a) of 
     section 24 of the Internal Revenue Code of 1986 (relating to 
     child tax credit) is amended by striking ``an amount equal to 
     $500'' and all that follows through the period and inserting 
     the following: ``an amount equal to--
       ``(1) $1,500 in the case of a qualifying child who is 5 
     years of age or less, and
       ``(2) $500 in the case of all other qualifying children.''.
       (b) Coordination of Dependent Care Credit.--Section 21 of 
     the Internal Revenue Code of 1986 (relating to expenses for 
     household and dependent care services necessary for gainful 
     employment) is amended by inserting ``over the age of 5 and'' 
     before ``under the age of 13'' each place it appears in 
     subsections (b)(1)(A) and (e)(5)(B).
       (c) Effective Date.--The amendments made by this section 
     shall apply to taxable years beginning after December 31, 
     1998.
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