Policymakers in Louisiana to Consider Raising State EITC
As lawmakers have returned to Baton Rouge to address a pending budget shortfall, we cannot forget the benefits of the state Earned Income Tax Credit (EITC).
Facing a $700 million mid-year budget deficit, newly-elected Governor John Bel Edwards has laid out a number of revenue-generating ideas to help Louisiana right the fiscal ship. But a number of the solutions proposed would negatively impact the poorest Louisiana families. While drastic financial times warrant drastic measures, Gov. Edwards and policymakers in Baton Rouge have the opportunity to mitigate this increased tax burden by doubling the state EITC from 3.5 percent to 7 percent, providing the families that need it the most with a long-term benefit.
Common Sense Kids Action supports the state-based EITC policy because the policy offers a cash-back tax credit available to qualifying low- and moderate-income working individuals and families. Evidence from the federal EITC shows that it helps recipients improve their economic stability and that kids from recipient families perform better in school.
The poorest 40 percent of Louisiana households paid 10 percent of their family income in state and local taxes last year. An increased EITC would not only help working families afford basic needs, but it would help stimulate local economies with added income.
Common Sense Kids Action is proud to join the Louisiana Budget Project, The United Way, the Louisiana Conference of Catholic Bishops and other partners in supporting a 7 percent state Earned Income Tax Credit.
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