Eliminating tax credit will increase burden on working families
Contact: Judy Putnam at (517) 487-5436
Statement from President & CEO Gilda Z. Jacobs on House Speaker Jase Bolger’s plan to repeal the Michigan Earned Income Tax Credit:
“While we recognize the desire for everybody in the state to share in the sacrifice, poor people are being asked to be the sacrificial lambs. The Michigan Earned Income Tax Credit, which helps low- and moderate-income working households, should not be the first credit considered among Michigan’s $34 billion list of tax expenditures, including tax breaks for big corporations.
Eliminating the EITC will put more of the tax burden on those who can least afford it – the families of minimum wage workers and those who do important work in our state including janitors, waitresses, home care aides and child care workers.
Also, the credit is a proven economic stimulus, and its elimination will hurt small business in local communities across the state. A report by the Anderson Economic Group finds that for each $1 in federal earned income tax credit, $1.67 is generated in economic activity.
Prior to the nearly unanimous enactment of the state EITC in 2006, Michigan’s income tax code was among the harshest in the country for taxing people living deep in poverty. Now we are about average among the states for the point at which we tax income. At the same time, our tax code means our wealthiest taxpayers pay less in state income taxes than higher-income taxpayers in about 40 states.
Our lawmakers need to make sure the most vulnerable among us are protected as we continue to weather difficult economic times. This action, however, would deeply harm some of the most vulnerable people in our state, including the half-million children living in poverty.”
Comments (8)
As a volunteer with the Berrien County VITA program for 5 years, I am acutely aware of the benefit of the EITC (earned income tax credit) for working families. We are currently gearing up for tax season in a just a couple weeks. I do not look forward to the thought that our families/clients will get EITC refunds this year, but next year may not.
The credit is only available to those who have earned income, i.e., who have or had a job in the tax year. Thus, it encourages folks to work, to seek employment.
Regardless if you are Republican or Democrat, THAT is a good thing.
The EITC benefits families who make less than the following amounts:
Single with one child: Less than $35,500 per year with the maximum credit at between $8,950 – $16,450 per year.
Married with two children: Less than $45,350 per year with the maximum credit at between $12,550 – $21,500 of income.
Families who are earning at these income levels deserve thanks and appreciation for their efforts at supporting their families. They also need financial assistance with their day-to-day expenses: Child care, transportation, medical, school clothes, rent, etc.
More information about the earned income credit can be found at:
http://www.michiganeic.org/about
Rob Burgess, CPA
Coordinator for the Berrien EITC
Sorry but everyone has to share in the cuts. We can no longer afford to provide the breaks to these families when others are suffering just as equally. Numbers can be manipulated to create what ever kind of picture you want. The truth is, everyone has to pay a price in order for the state to get back on its feet.
Taxpayer – are you serious? Taking from the working poor? That is where this new legislature wants to start??? Balance the budget on the backs of the poor. Typical.
Getting elected with a “no more tax – taxed enough alreay” campaign cry, then alleviating the Earned Income Credit, is nothing more than a sneaky and cheeky way to increase taxes, and fund big government on the backs of the poor.
Shame, shame!
tax payer – do you realize that the government is in talks right now to eliminate this tax credit BUT also eliminating the Michigan Business Tax? That means work families, who need money, get less, and business owners receive more. How is that “sharing the cuts”? It’s not. I’m fine if you believe that the government should save money, but shifting money from working families to business owners and at the same time saying everyone is “sharing in the cuts” is ludicrous.
I guess I have to wonder “who is all” that are sacrificing in Michigan? We have just been told our budget director will make a quarter of a million dollars ($250,000)to work on the State finances because we need the best and brightest! Decoded: our state workers (white collar professionals and pink collar workers) are not worth the small money we pay them. We also see an expansion of state government with the division of DNR, which has proven cost more money to operate. So who is “all”? It is all so Republican –rich get richer while the poor get poorer as we pretend to care about the middle and lower class citizen.
On Sunday, February 6, 2011, a group of us wrote the following:
An open letter to Governor Snyder and the Legislature:
As a group of concerned Christian (and Judiac) citizens, we are greatly dismayed to learn of the proposal to eliminate the Earned Income Tax Credit for the working poor. Whereas the wealthy pay taxes from their surpluss, elimination of the Earned Income Tax Credit would deprive low income families of the ability to pay for basic needs such as food, clothing, shelter, and transportation. We urge you to seek other more fair and equitable means to address the State budget shortfall.
(Signed by:) Nancy Flynn, Lois P. Lynch, Anne M. House, Alvin E. House, Ralph Hepp, Donna Costantino, Mary S. Hennessey, Lawrence Hennessey, Allison K. Dowling, Gregory M. Wierzba, Patricia A. Hepp, Elaine M. Weipert, Mary Ann Dunn, Harold J. Spaeth, E. Michael McMullen, Victor H. Weipert, William Dowling, Henry Blosser, Robert T. Mareck, Joan Wierzba, Maureen K. McMullen, Shirley Tighe Frank, Colleen Hyslop, Rafael Frank.
At a time that people are in dire straights, our population is decreasing due to the lack of jobs and the only way you see to fix Michigan’s problem is to put an additional burden on the poor. Yet the wealthest in our state never should feel obligated to feel any need to bare the burden, that the rest of us should be obliged to do. They have gained the most from all legislative laws in good times and bad. So why should’nt they now contribute to the solution.