The Pennsylvania House of Representatives approved legislation that would provide tax credits to businesses that cover childcare costs for employees, with employers able to offset up to 30 percent of the costs.
HB 1958, also known as Incentivizing Employer Contributions to Employee Childcare, passed the Pennsylvania House last Wednesday with 155 votes in favor and 47 against.
Prior to introducing the legislation, Representatives Liz Hanbidge (D-Blue Bell) (pictured above, right) and Morgan Cephas (D-Philadelphia) (pictured above, left) explained, “our hope that incentivizing employer contributions to employees’ childcare expenses will not only help employers attract and retain quality candidates who might otherwise not be able to enter the workforce, but also ease the financial burden on parents who genuinely want to work.”
The legislation would allow employers in Pennsylvania to receive tax credits totaling 30 percent of the aggregate contributions they made toward employees’ childcare benefits.
Should the legislation be approved by the Pennsylvania Senate, the law would become active immediately upon being signed by Governor Josh Shapiro.
A spokesman from Shapiro’s office told the Pittsburgh Post-Gazette the governor is monitoring the bill’s progress, and the outlet reported the legislation is widely expected to receive bipartisan support in the Senate.
Shapiro previously signed a tax credit expansion for childcare in 2022, with families reimbursed for up to 30 percent of the child care expenses listed on their federal income taxes, but critics warned the neediest families in the commonwealth likely failed to benefit.
The effort comes as childcare costs continue to rise, with a November 2023 report revealing the cost of providing care for children is increasing faster than the official rate of inflation.
Last September, childcare costs ran families $700 per month on average, which The Daily Caller reported was 32 percent lower than in 2019, citing the Bank of America (BofA) Institute. The report found inflation was measured at 20 percent over the same period.
Inflation remained high in April, according to the latest information from mid-May, which found the price of everyday good measured by the consumer price index (CPI) had increased by 3.4 percent over the previous year and 0.3 percent over March.
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Tom Pappert is the lead reporter for The Tennessee Star, and also reports for The Pennsylvania Daily Star and The Arizona Sun Times. Follow Tom on X/Twitter. Email tips to [email protected].
Photo “PA State Rep. Morgan Cephas” by Rep. Morgan Cephas. Photo “PA State Rep. Liz Hanbidge” by Rep. Liz Hanbidge. Background Photo “Pennsylvania House of Representatives Chamber” by Concord. CC BY-SA 4.0
