WA State Legislature Passes the Working Families Credit
By Sue Donaldson
Mar 11, 2008
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The Washington State Legislature has passed the Working Families Credit, a sales-tax relief package for low-income families.
As part of our
work with the Seattle - King County Asset Building Collaborative, led
by Senior Fellow Diana Stone, Washington Appleseed conducted
research about the feasibility of implementing a state credit for
low-income families, similar to the federal Earned Income Tax Credit.
The
federal Earned Income Tax Credit (EITC) is a tax reduction and wage
supplement for low- and moderate-income working families. The credit
is based on family size and earnings. For families with very low
incomes, the amount of the credit increases as earnings increase until
it reaches the maximum for that family size -- $428 for families with
no children, $2,853 for families with one child, and $4,716 for
families with two children (figures based on 2007, figures to increase for 2008). The credit begins phasing out for families with children at $16,810 and ends completely at $38,348.
In
2003, about 22 million families claimed the EITC. It now lifts more
than 4 million people -- half of them children -- out of poverty.
Because it targets working families, the program has received broad,
bipartisan support at the national level.
State and local
governments across the country have embraced the program as a means to
combat poverty. Twenty-two states, the District of Columbia, and four
local governments had enacted EITC programs modeled after the federal
program.
In Washington State, legislation was introduced
into the 2008 state legislative session to create a Working Families
Credit, which has now passed both the House and the Senate. However, the House amended the Senate Bill to make the tax-relief package optional, not a requirement. During the approval process for each two-year budget cycle, the Legislature must decide if the Working Families Credit will be included in that cycle.
Through Washington Appleseed, the pro bono
research work of Michele Radosevich, a partner in the governmental
relations practice at Davis Wright Tremaine, has been an invaluable
contribution to the discussion about a Working Families Credit in
Washington State.
For Washington Appleseed opinion pieces on the Working Families credit, please see:
Helping working families a good deal for everyone
Seattle Times, March 3, 2008
By Sue Donaldson and Gary Locke
With
tax reform among the hot topics in Olympia, Washington's
Legislature can give a needed boost to the state's economy and help
workers in one easy stroke. It's called the Working Families Credit,
and it's designed to help struggling low-wage earners make ends meet.
Proposal gives low-wage workers in Washington a tax-break
Seattle Post-Intelligencer, February 14, 2008
By Sue Donaldson and Michele Radosevich
While lawmakers in "the other Washington" have put the finishing
touches on an economic stimulus package that will provide checks from
the federal government to many nationwide, here in Washington state,
discussions are taking place on how to reduce the regressivity of our
tax structure and its disproportionate effect on low-wage individuals
and their families.
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