Senator Haywood and Representative Innamorato, PA Budget & Policy Center analysts cite new report showing tremendous hardship across the state, urge enactment of EITC to help PA’s working families

HARRISBURG — August 26, 2020  — State legislators Senator Art Haywood and Representative Sara Innamorato, and Pennsylvania Budget and Policy Center (PBPC) analysts hosted a press conference call on Wednesday morning that featured state policy experts Marc Stier, Director, and Diana Polson, Senior Analyst, of the PA Budget and Policy Center.

The federal Earned Income Tax Credit (EITC) is a program that puts more money into the pockets of low- and middle-income families by giving them a credit against the taxes they pay. No federal program other than Social Security, reduces poverty as much. Twenty-nine other states have expanded the benefits of a federal EITC by enacting a state EITC.  

Passing a state EITC plan would also have a stimulus effect during this COVID-related economic downturn. State EITC money would help low- and middle-income workers in the state and would go directly back into the economy.

Senator Haywood (D- Montgomery and Philadelphia counties),  stressed the need for a state EITC and said, “Last year, I embarked on a statewide poverty tour to hear from folks who have been disproportionately impacted by the system and kept in poverty. I heard compelling and heartbreaking stories about the various reasons why people experience poverty and are unable to break the cycle. COVID-19 has only exacerbated those struggles and the EITC program will provide some relief in the short term. We must not forget that long-term solutions, such as raising the minimum wage to a living wage, must continue to be fought for if we want to realize true financial equality in our state and nation. Providing financial stability to our impacted communities will only make us stronger as a whole and better poised to tackle any unforeseen hardships or global disasters in the future.”

Marc Stier, Director of the PA Budget & Policy Center added, “Pennsylvania should follow other states’ lead. A state EITC is a relatively inexpensive program that is easy for states to implement, especially if it is modeled on the federal EITC. The benefits of increasing the annual income for low-income families and reducing poverty is indisputable. It improves maternal and infant health, enhances school performance for children, and leads to both higher high school graduation and college attendance rates. The EITC has even been shown to boost future earnings and work prospects for children whose families receive it.”

In this report, we examine the problem of poverty and low wages in Pennsylvania and how a state EITC can improve the well-being of working families. We look at how the federal EITC functions and what its benefits are. We then make recommendations and examine the potential impact of a Pennsylvania state EITC, including how it would interact with Pennsylvania’s existing Tax Forgiveness Program.

The full report is available at