Ronald Reagan called the Earned Income Tax Credit (EITC) "the best anti-poverty, the best pro-family, the best job creation measure to come out of Congress."
Wisconsin, like many other states, has its own EITC, which supplements the federal credit. The Wisconsin credit has enjoyed broad bipartisan support. The legislation creating it was co-authored by many Republicans, and the credit was signed into law by Tommy Thompson. However, some people think Governor-elect Walker may propose cutting the popular tax credit for the working poor.
In a column in Sunday’s Milwaukee Journal Sentinel (MJS), former MJS reporter Steven Walters speculates that Walker will propose cutting the state EITC. I think Walters does a good job of describing the issue and the debate that may lie ahead. However, I’m biased in that assessment because the column quoted my arguments against cutting the state credit:
"Cutting the Earned Income Tax Credit would be a harsh blow for . . . low-income working families, especially during the recession when so many low-wage workers have reduced hours and earnings," Peacock said.
"Cutting the EITC is essentially the same as raising taxes on low-income working families. Wisconsin's credit was designed to lift the families of low-wage workers above the federal poverty level," Peacock added.
"We would have to question the priorities of any politicians willing to cut the EITC while refusing to adjust the minimum wage for inflation and insisting on giving tax breaks to the wealthiest households."We’ll keep close tabs on the EITC issue throughout the budget process and will use blog posts to provide updates when there is breaking news. From this website you can subscribe to get the posts by email or RSS feed, so you never miss an update. You can also visit the Wisconsin Budget Project on Facebook and “like” us to keep up to date with revenue-related developments.