2011 Legislative Preview: HB 1025

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Programming note:  Given the number of bills being filed, the amount of time I actually have to do reviews of such things, and the airspeed velocity of an unladen swallow, it’s pretty clear that I won’t be able to get through every bill.  With that in mind, I’m going to start bouncing around and focusing on bills that jump out at me one way or the other.

See here for previous posts in this series.

Bill Name: AN ACT TO PROVIDE AN INCOME TAX CREDIT FOR A PARENT WHO CHOOSES TO STAY AT HOME WITH HIS OR HER YOUNG CHILD; TO PROVIDE FOR FAMILY PRESERVATION

Sponsors: Denny Altes (R-63), 479-646-8981, aaltes@aol.com

Purpose: And I quote, “to provide families financial assistance and monetary incentives to help one (1) parent stay at home with the family’s children in the nuclear family atmosphere” by “allow[ing] the children to be raised without relying on outside child care or day care.”  Essentially, this bill provides a yearly $1000 credit for a stay-at-home parent of a child four years of age or younger.  Think of it as German-style socialism after an Arkansas Republican had the chance to mess it up.

Pros for Average Arkansans: Well, considering this bill only applies to families with an adjusted gross income of $32,000 or below, the demographic is small to begin with.  On top of that, if the stay-at-home spouse was employed at ANY point during the tax year (i.e. if she worked up until the baby was born), they are not eligible for the credit.  Likewise, if the stay-at-home parent has the temerity to attend high school, college, community college, or a vocational school, they are not eligible for the credit.  Throw in that it’s hard to imagine very many people in a household with that income eschewing actual paid employment merely to receive a $1000 credit — less than $100/month, an amount which does not even come remotely close to being meaningful — and this bill would seem to have little benefit.

Altes claims that the bill “will reduce the occurrence of juvenile crime, the need for discipline in the public schools, and the number of people sentenced to prisons in Arkansas by strengthening the family.”  This is an asinine and unsupportable proposition.

Cons for Average Arkansans: Losing $1000 in tax revenue (times the number of families who claim the credit) by paying people not to work AND not to go to school (even high school!).  The German model of this plan pays up to 67% of the person’s prior income in order to allow the parent to stay home for up to 14 months.  That makes sense.  This bill?  Not so much.

Official BHR Position: Strongly oppose as bad policy.