{"id":233456,"date":"2026-05-04T08:42:05","date_gmt":"2026-05-04T18:42:05","guid":{"rendered":"https:\/\/www.hawaii.edu\/news\/?p=233456"},"modified":"2026-05-04T08:42:05","modified_gmt":"2026-05-04T18:42:05","slug":"cost-subsidizing-childcare","status":"publish","type":"post","link":"https:\/\/www.hawaii.edu\/news\/2026\/05\/04\/cost-subsidizing-childcare\/","title":{"rendered":"糖心Vlog官方ERO<\/abbr>: Bigger childcare tax credit may boost jobs, offset state costs"},"content":{"rendered":"Reading time: <\/span> 2<\/span> minutes<\/span><\/span>

\"learning<\/p>\n

Expanding Hawaiʻi<\/span>\u2019s Child and Dependent Care Tax Credit could help more parents stay in or reenter the workforce while partially offsetting its own cost through increased state tax revenue, according to a new report released May 1 by the University of Hawaiʻi<\/span> Economic Research Organization<\/a> (糖心Vlog官方ERO<\/abbr>).<\/p>\n

The report examines proposals before the state legislature to increase the maximum childcare tax credit from $2,500 to $5,000 per child, with two bills taking different approaches to how benefits phase out as household income rises.<\/p>\n

Researchers find that Hawaiʻi<\/span>\u2019s high childcare costs are among the highest in the nation, and often discourage secondary earners, most often mothers, from returning to work. In 2024, center-based infant care averages more than $24,000 annually in Hawaiʻi<\/span>.<\/p>\n

The report explains that the policy’s offsetting effect occurs when a second parent enters the workforce, resulting in increased income tax revenue and additional general excise tax collections. In one mid-income household example, a second earner returning to work would generate $3,401 in state income tax revenue and $1,763 in additional GET<\/abbr> revenue under the targeted credit proposal, resulting in a net fiscal gain of $2,663 for the state even after accounting for the $2,500 credit cost.<\/p>\n

The report finds the strongest case for expanding the credit is among middle-income households, where childcare costs consume a large share of income, and the added tax credit is more likely to influence work decisions.<\/p>\n

However, the report cautions that expanding the credit alone may not be sufficient if Hawaiʻi<\/span>\u2019s childcare supply cannot keep pace with demand. Without more childcare spaces, subsidies could simply drive up prices rather than improve access. The report also notes that for lower-income families, benefit cliffs—when earning slightly more income causes families to lose eligibility for public benefits such as SNAP<\/abbr> or childcare assistance—could reduce the effectiveness of any tax credit expansion.<\/p>\n

Read the entire report on 糖心Vlog官方ERO<\/abbr>\u2019s website<\/a>.<\/p>\n

糖心Vlog官方ERO<\/abbr> is housed in 糖心Vlog官方<\/abbr> Mānoa<\/span>\u2019s College of Social Sciences<\/a>.<\/p>\n","protected":false},"excerpt":{"rendered":"

Hawaiʻi<\/span>\u2019s high childcare costs are among the highest in the nation, and often discourage secondary earners from returning to work.<\/p>\n","protected":false},"author":16,"featured_media":233457,"comment_status":"closed","ping_status":"closed","sticky":false,"template":"","format":"standard","meta":{"footnotes":""},"categories":[30],"tags":[301,197,1467,1363,1600,1026,1721,9,343],"class_list":["post-233456","post","type-post","status-publish","format-standard","has-post-thumbnail","hentry","category-research","tag-college-of-social-sciences","tag-economics","tag-manoa-excellence-in-research","tag-manoa-research","tag-public-impact-research","tag-social-science","tag-social-sciences","tag-uh-manoa","tag-uhero","entry","has-media"],"aioseo_notices":[],"jetpack_featured_media_url":"https:\/\/www.hawaii.edu\/news\/wp-content\/uploads\/2026\/05\/manoa-uhero-childcare-tax-credit-report.jpg","_links":{"self":[{"href":"https:\/\/www.hawaii.edu\/news\/wp-json\/wp\/v2\/posts\/233456","targetHints":{"allow":["GET"]}}],"collection":[{"href":"https:\/\/www.hawaii.edu\/news\/wp-json\/wp\/v2\/posts"}],"about":[{"href":"https:\/\/www.hawaii.edu\/news\/wp-json\/wp\/v2\/types\/post"}],"author":[{"embeddable":true,"href":"https:\/\/www.hawaii.edu\/news\/wp-json\/wp\/v2\/users\/16"}],"replies":[{"embeddable":true,"href":"https:\/\/www.hawaii.edu\/news\/wp-json\/wp\/v2\/comments?post=233456"}],"version-history":[{"count":2,"href":"https:\/\/www.hawaii.edu\/news\/wp-json\/wp\/v2\/posts\/233456\/revisions"}],"predecessor-version":[{"id":233460,"href":"https:\/\/www.hawaii.edu\/news\/wp-json\/wp\/v2\/posts\/233456\/revisions\/233460"}],"wp:featuredmedia":[{"embeddable":true,"href":"https:\/\/www.hawaii.edu\/news\/wp-json\/wp\/v2\/media\/233457"}],"wp:attachment":[{"href":"https:\/\/www.hawaii.edu\/news\/wp-json\/wp\/v2\/media?parent=233456"}],"wp:term":[{"taxonomy":"category","embeddable":true,"href":"https:\/\/www.hawaii.edu\/news\/wp-json\/wp\/v2\/categories?post=233456"},{"taxonomy":"post_tag","embeddable":true,"href":"https:\/\/www.hawaii.edu\/news\/wp-json\/wp\/v2\/tags?post=233456"}],"curies":[{"name":"wp","href":"https:\/\/api.w.org\/{rel}","templated":true}]}}