United Way of Pennsylvania’s President Kristen Rotz, issued the following statement on behalf of the organization, highlighting the missed opportunity to provide working families with meaningful tax relief – and depriving all residents of related economic growth – in the state budget that is being considered by the General Assembly:
“Pennsylvania’s new state budget does not provide the tax relief that our state’s hard-working families need. A refundable Earned Income Tax Credit would return some of the hard-earned tax dollars that inflation-ravaged households, who are living paycheck to paycheck, could really use to help pay their bills.
This bi-partisan effort would also generate an economic impact seven times its cost through $4 of economic growth and $3 dollars in savings for social spending, according to an economic impact analysis United Way commissioned in 2022.
A state earned income tax credit will generate annual benefits between $562 million to $1.2 billion to the state economy. A refundable state EITC will put $200 to $600 back into workers’ pockets.
Prior to the pandemic, 39 percent of PA households were working and earning an income that was insufficient to afford just the basic costs of living, including housing and utilities, food, child care and transportation costs. We call these households ALICE – Asset-Limited, Income-Constrained, Employed.
While the average income of many households has increased, the costs of the essentials have increased at a higher rate, so there are even more households who are living paycheck to paycheck in 2022.
Representative Martina White (R-Philadelphia) and Senator Mario Scavello (R-Monroe), with bi-partisan support, have introduced identical pieces of legislation, SB 1082 and HB 2382, which phase in a refundable state EITC.
This legislation earned the support of a diverse coalition of partners that includes United Way, NFIB Pennsylvania, the PA AFL-CIO, Pennsylvania Partnerships for Children, the PA Workforce Development Association, and many other networks who provide services to working families.
A refundable tax credit on earned income is a tax policy which supports the economic future of a graying state by making PA more attractive for working families and keeping those who are already here.
It is time for our state’s elected officials to make Pennsylvania competitive with our neighboring states, and 30 other states across the country, and create a refundable EITC in the Commonwealth.
We look forward to working with PA’s lawmakers and our coalition of partners to garner the benefits of the Earned Income Tax Credit, for working families, and all residents of our Commonwealth. It’s not too late to enact this policy this fall.”
More information on the benefits of a refundable Earned Income Tax, including estimated benefits to households in different parts of PA, is available here: https://www.uwp.org/advocacy/eitc-study/
About United Way of Pennsylvania (UWP)
United Way of Pennsylvania is a 501(c)(3) organization with a mission to champion United Way as a leader and partner in building more financially resilient families and thriving communities throughout Pennsylvania. United Way of Pennsylvania envisions an inclusive, impactful and collaborative network of United Ways working with business, community, faith and government leaders to advance equitable access to health, education and financial stability for all Pennsylvanians.
United Way is committed to raising charitable dollars that are invested in community impact work which addresses needs specific to the local community. In many cases, these funds support public-private partnerships that further leverage state taxpayer dollars.
United Way also commits to advocate for policy change which will help more Pennsylvania families and communities achieve the basic building blocks of a good quality of life in Pennsylvania. UWP is a membership organization which serves as the voice for 43 member United Ways and 2 United Funds across the Commonwealth.