A Way to End Poverty in Pennsylvania

from The Philadelphia Daily News

STATE EITC IDEA IS ONE WHOSE TIME HAS COME
ONE PUBLIC HEARING does not a state bill make, but the warm reception given to a proposed state Earned Income Tax Credit for low-income Pennsylvanians was a heartening sign for an idea that should become law.

The idea for a state EITC, which could bring $1,400 to poor families, was introduced by Democratic state Rep. Dwight Evans in the 2005-2006 legislative session, but the Republican majority kept it under wraps.

How things, and leadership, have changed.

Last week the House Finance Committee, now chaired by David Levdansky, D-Allegheny, held hearings in Philadelphia on the bill, H.B. 377. And committee members, including the minority chairman Republican Steven R. Nickol, appear on board with the concept. The bill could come up for consideration around July, when the state budget must be passed.

Poverty is not just a Philadelphia or Pittsburgh thing, either. As Pennsylvania has gone from manufacturing to service jobs, pockets of poverty in rural areas have grown.

The state EITC would be similar to the Federal EITC, where poor families can get as much as $4,500 in tax refunds. The state EITC would equal 30 percent of the federal credit.

The state already offers some help for low-income families. The Pennsylvania Income Tax Forgiveness program eliminates state income tax liability for qualified families. But these savings don't translate into money in the pocket. A state EITC would. That's money to buy big ticket appliances or pay off utility bills.

It is also another way to help create the most important thing an economy needs - a middle class. In 2003, 163,000 working families with kids had incomes below the federal poverty line. The poverty rate in Philadelphia is an astounding 25 percent.

The EITC programs can help end poverty. This page has been a strong advocate for the federal program, championed locally by the Campaign for Working Families. We feel no different about this.

Twenty states, including Washington D.C., have state EITCs. In Pennsylvania, the initial cost is expected to run about $200 million a year, but ideally will drop as more families leave the poverty rolls. A state EITC is a win-win: a good deal for poor working families, a good deal for Pennsylvania.