North Carolina families are working harder than ever. We’re working longer hours and being more productive by every economic measure. Over 2 million women in the state work for wages and salaries, and over 40 percent of those women are the primary breadwinners for their families. That’s more than 800,000 North Carolina women who must provide both financial and caregiving support to spouses or partners, children, parents, and other family members.
But our paychecks haven’t reflected our hard work for a long time now. And there are still too many working families who are struggling to make ends meet. One in three workers in the state earns poverty-level wages, and one out of every four children in North Carolina live in poverty. Fortunately, there’s something we can do about it.
The Earned Income Tax Credit (EITC) is a tax credit for working families that reduces poverty and rewards work for low- and moderate-income households. Until recently, these households could claim the state EITC as a way to cover the basics and plan for the future. But in 2013 our state lawmakers eliminated the state credit, which made North Carolina the first state in nearly 30 years to roll back this crucial and effective anti-poverty measure. Nearly 1 million working North Carolinians claimed the state EITC for the last time in 2014, benefiting more than 1.2 million children and pumping $100.8 million into local economies.
The EITC is the most effective anti-poverty tool that legislators have at their disposal. It also promotes tax fairness by offsetting the taxes that take the biggest bite out of low-income workers’ paychecks, like the sales tax. It creates short-term benefits by boosting the incomes of working families, and has long-lasting positive effects: Low-income children whose families use tax supports like the EITC perform better in school, are more likely to attend college, and earn more on average when they grow up.
Years after the recession, North Carolina working women are still trying to find their footing in a shaky economy. Having the state Earned Income Tax Credit would mean more cash for healthcare, or groceries, or utility bills—more cash for the things we all need to keep our heads above water.
For the past few years, our lawmakers have been pursuing deep tax cuts that primarily benefit powerful businesses and wealthy residents. It’s time to prioritize working families with a bottom-up tax cut, and bring back the EITC.