Earned Income Credit Again Advances in PA Legislature
A bill to establish a Pennsylvania Earned Income Credit (EIC) is scheduled for a vote in the Pennsylvania House the week of January 14th. House Bill 377 (sponsored by Rep. Dwight Evans) would create a state EIC set at 15% of the federal Earned Income Tax Credit beginning in Tax Year 2008 and 30% of the federal credit beginning in Tax Year 2009 and beyond. Working families with children would be eligible for the credit, which is an alternative to the state's current Tax Forgiveness program.
A state EIC would make the state's tax system more fair, and would return almost $1000 to a single parent family earning $12,000 a year, and $900 to a family of four earning $15,000 a year, in addition to tax forgiveness. This income would help to offset other taxes and provide much needed resources to the Commonwealth's poorest working families.
More than 15 amendments have been added to the bill and will be debated on the floor. Proposed amendments would eliminate the state inheritance tax, reduce the state personal income tax rate, repeal the telephone gross receipts tax and reduce business tax liabilities. Each of these amendments would add substantially to the cost of the legislation and provide little or no benefit to low-income working families.
PBPC released a revised analysis of the EIC bill on January 16th.
