Child Tax Credit Likely to Help Retailers Soon

Retailers are likely to see a boost in spending as the new child tax credit hits consumers’ wallets, according to CNBC.
child in shopping cart

The credits, which began July 15, are between $250 and $300 in payments per child, depending on age. Retailers have benefited from the government’s COVID-19 pandemic stimulus funds already.

“It’s a good thing for Walmart and grocery stores,” Jim Sullivan, economics professor at the University of Notre Dame, told CNBC. “The retail sectors where middle- and lower-income families spend money are likely to benefit some from this.”

Sullivan is studying the impact of the coronavirus pandemic on Americans living in poverty. Previous stimulus checks from the government have boosted retail sales, and many Americans are planning to spend their stimulus money on back-to-school items this summer. The child tax credits are the latest COVID-19-related funding from the government, and there are no plans from Congress to disperse a fourth round of stimulus checks for individuals.

Eligible families will receive between $2,000 and up to $3,600 annually for each child, depending on the age of the child. Families making up to $150,000 for a couple can receive the full amount, or $112,500 for a family with a single parent or single head of household, CNBC noted. Individual taxpayers that make up to $75,000 are also eligible to receive the full amount, and credits are phased out for those making above those limits. Roughly 39 million households will begin receiving the payments. 

Mass retailers such as Walmart, Target, Costco, Bj’s Wholesale Club and more are among those retailers most likely to benefit from consumers having extra cash. Since the start of the pandemic, mass retailers that enabled one-stop shopping for many families saw huge demand. Dollar stores are also likely to see a lift in sales from the credits, CNBC reported. 

See the full report from CNBC here