Rubio’s Education Plan Cuts Tax Credits For Low-Income Families To Help Rich Families Pay For Private School

Florida’s Republican Senate candidate Marco Rubio has released a series of policy proposals in various subject areas, in an attempt to prove that he isn’t out “just to paralyze government.” We’ve already taken a look at his ideas when it comes to tax and budget policy, but Rubio has also released an outline for education reform.

His very first idea is to convert an unnamed number of tax credits and deductions into a “universal education tax deduction” for sending students to private school. “On the whole, this would provide tax relief to parents for school supplies, home schooling costs, sending their children to private school or for those saving for their children’s college education,” Rubio claimed.

There are a couple of problems with this. First, choosing a deduction — instead of a straight tax credit — makes this worth more to rich families than poor, as deductions get applied to the last dollar of taxable income. So a rich family paying in the 35 percent income tax bracket gets a bigger break than a family paying in the 10 percent bracket.

Plus, as the Orlando Sentinel’s Mike Thomas pointed out, “what good is a deduction for school supplies…to low-income parents who don’t itemize?” In fact, by choosing a deduction, Rubio explicitly prevents any low-income family that is too poor to have federal tax liability from gaining any benefit at all, as you must have some income tax liability to claim a deduction (whereas you can claim a refundable credit even if you paid no federal income tax).


Next, as M.S. at the Economist noted, Rubio doesn’t dedicate enough money to the credit to make it any more than a giveaway to families who were already going to send their kids to private school anyway:

There are 55m students in primary and secondary education in America; 5.8 m of those students are enrolled in private primary and secondary schools. (Mr Rubio’s credits would apply to college as well.) And the goal would presumably be to allow more students to transfer to private schools, if they so choose. Average private-school tuition in 2007–8 was $8,550. (Religious schools are only moderately cheaper than average: average tuition at Catholic high schools was $7,500.) So Mr Rubio’s $7 billion could, at best, provide a thousand-dollar tax break for those parents already able to afford private-school tuition, or those at the margin who are almost able to do so. There isn’t enough money there to allow low-income families who can’t currently afford to spend thousands of dollars per year on tuition to do so.

Not all of Rubio’s ideas on education reform are as bad as this one. In fact, his proposal that state block grants for education “should require performance and accountability measures” is a good one! But his plan for converting billions in education tax credits into a private school tax deduction shifts education spending from those who need it the most to those who need it the least.