The recession is supposed to be over, right? You might not know it.
Today, there are still tens of thousands of working parents in our state on the job all week long who have a tough time making ends meet. You might be one of them, and if not, you’ve met her. She is working the register at the grocery store, watching your child at daycare, taking care of grandpa at the VA, or stocking shelves at Walmart.
This could be a big week for those working parents and their children. In other states in New England those families get some much needed help – a couple of extra thousand dollars around tax time. But here in Massachusetts, they get a lot less. This week that could change.
Here’s what you need to know. The federal Earned Income Tax Credit, sometimes called the EITC, is one of America’s most successful ways to make sure that, if you work for a living, you shouldn’t have to live in poverty. For every dollar’s worth of the federal EITC a working mom or dad receives, the state of Vermont adds in 32 cents. New York contributes 30 cents. Washington, D.C. does 40. In Massachusetts we’re stuck at 15.
It’s rare for Republicans and Democrats to agree on anything these days. But Massachusetts Gov. Charlie Baker, and State Senate President Stan Rosenberg have both said it is time to give working families a raise by increasing the state match.
This week, Beacon Hill debates the state budget. Massachusetts can lead the nation by setting a 50 percent match. Increasing the state match to 50 percent of the federal EITC would boost the maximum benefit for working families from less than $1,000 to about $3,000. The earned income tax credit is a big deal in Framingham and Marlborough, where about 1 in every 8 taxpayers claims the credit. Even in Hopkinton, a couple hundred taxpayers get the EITC.
Both of us have spoken to working parents in Massachusetts and seen that the Earned Income Tax Credit is an example of government doing something right. Nothing in this world is perfect, but this is a tax credit that rewards work, gives working parents a sense of dignity, and provides capital that families can invest wisely. And they usually do. In Laura’s investigation of families who get the credit, she has seen parents do things like buy school clothes for their kids, purchase a used car to get to work, and pay off high-interest credit card debt.
An increase in the state’s Earned Income Tax Credit would help a lot of working families. Helping working parents, protecting the middle class, investing in communities, and fighting inequality – this is what government should be all about.
Jamie Eldridge of Acton is a Massachusetts State Senator. Laura M. Tach is an assistant professor of Policy Analysis & Management at Cornell University.