House Budget Committee Chair Jodey Arrington of Texas unveiled a reconciliation framework this week that would fund a $70 billion expansion of ICE by cutting two of the most effective anti-poverty programs in the federal tax code: the Earned Income Tax Credit (EITC) and the Low-Income Housing Tax Credit (LIHTC).
The EITC alone lifted 5.6 million people out of poverty last year, more than half of them children. The LIHTC is responsible for virtually all affordable housing construction in the country. Both are on the chopping block so Republicans can write a bigger check to Immigration and Customs Enforcement.
What Gets Cut, Who Gets Hurt
The EITC is a refundable tax credit that phases in with earnings and phases out as income rises. Working-class families with children are the primary recipients. Arrington's proposal would tighten eligibility, reduce phase-in rates, and cap the maximum credit — changes that would cut benefits by an estimated $20 to $30 billion over the budget window.
The LIHTC underwrites nearly all affordable rental housing built in America. Developers use the credits to finance construction of units reserved for low- and moderate-income renters. Cutting or restructuring the credit would halt or slow hundreds of projects at a moment when the country is already in a housing affordability crisis.
The funding freed up goes to ICE: detention beds, deportation flights, enforcement agents, and detention facility expansion. Arrington's framework was pitched to the House Freedom Caucus as a way to demonstrate fiscal seriousness while delivering on Trump's mass deportation agenda.
The Math and the Choice
Republicans need to find offsets for the reconciliation bill, which includes extending the 2017 Trump tax cuts, already heavily weighted toward the wealthy, and adding new spending for defense and border enforcement. The question is who pays for it.
The answer, according to Arrington's framework: working families who claim the EITC, and renters who depend on subsidized housing. With 36 House Republicans already announcing retirement, vulnerable incumbents now own this vote heading into competitive 2026 districts.
"House Republicans are proposing to take money from the working poor and hand it to ICE. This is not a budget. It is a values document." — Rep. Lloyd Doggett (D-TX), House Ways and Means Committee, April 2026
Democrats on the Budget Committee were denied the ability to offer amendments. The markup was described by committee staff as unprecedented in scope and speed. Republicans need the numbers, and poor families are the ones providing them.
Sources
- Politico: House reconciliation framework targets EITC, housing credits for ICE funding
- Center on Budget and Policy Priorities: EITC and poverty reduction data
- National Low Income Housing Coalition: LIHTC overview and impact
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