As the Trump Administration and Congressional Republicans attempt to portray a tax plan slanted to the top 1 percent as “middle-class” tax relief, it’s worth asking what actual tax relief for American workers would look like. Among the ideas that should be at the top of the list should be expanding the Earned Income Tax Credit (EITC), a policy that provides millions of low-income American workers with up to a few thousand dollars when they file their taxes.

Just over 24 years ago, I was proud to be part of President Clinton’s effort to expand the EITC for families with two or more children. This expansion was a step toward fulfilling his campaign pledge that parents who worked full time should not have to raise their children in poverty. But the 1993 EITC expansion went beyond working parents, including smaller, but important, innovation: For the first time, the tax break would reach so-called “childless workers".....

.....Yet, for all that progress, the size of the tax credit for workers without children has barely changed. Its value has only increased to match inflation, making the maximum credit just over $500 now and the average EITC only $293 for this group. Only the lowest-income workers in this group are eligible. A full-time, year-round single worker who earns the federal minimum wage receives an EITC of only $37 to supplement her $14,500 in earnings, for example.....

.....Just last month MDRC, a nonpartisan social-policy research group, released interim findings on a major pilot, Paycheck Plus, that provided an up-to-$2,000 bonus to childless workers at tax time.  The study, which was designed by top economists including Harvard’s Lawrence Katz, included a randomized control trial involving more than 6,000 low-income, single adults without dependent children in New York City, half of whom received the bonus. It found that bonus boosted income (including the bonus) and rates of employment. The researchers linked the pilot to other positive results, such as increased tax filing and increased child-support payments.....

.....This is not to suggest an EITC for All is the only compelling progressive tax priority. Funds for increasing the EITC for All to higher incomes would have to be balanced against the compelling need for more support through child allowances or increased refundable tax credits for the youngest of children in the poorest of families.  But an EITC for All would efficiently and substantially provide millions of Americans with greater economic security and dignity. There’s no reason that should be limited to only those who list dependent children on their tax forms.

Full Article