Arkansas is part of a shrinking group of states that haven’t started using tax credits, like the Earned Income Tax Credit (EITC), to build their middle class and help people move permanently out of poverty. Arkansas remains among the worst states for overtaxing the poor. We ask low-income families to pay about twice the share of their income to state and local taxes compared to the top earners in our state. Tax credits like the EITC help reverse that. With a refundable state EITC, working families in Arkansas would keep more of what they earn and have a better shot at long-term financial stability and independence. Here’s what researchers in Arkansas and across the country are saying about the EITC:
- EITC Policy Basics from the Center on Budget and Policy Priorities: Take a look at this policy primer for a thorough introduction to how tax credits work and what types of positive impacts they have.
- States who Expanded or Adopted EITC in 2018 from the Institute on Taxation and Economic Policy: ITEP explores the momentum for EITC investment among states in 2018 in this brief. Tax credits are succeeding even in the South, where states like Louisiana have elected to adopt and expand their EITC.
- How EITC Lifts Families- Prosperity Now: In this blog post, find out how the EITC works to move families out of poverty.
- Polling in Arkansas: A recent poll finds strong bipartisan support for an EITC in Arkansas.
- The Arkansas Tax Task Force considers an EITC: The group of legislators meeting to produce a report on recommended tax changes ahead of the 2019 legislative session is considering including an EITC in their final recommendations.
- Reinforcing the Bridge out of Poverty: An Arkansas EITC – Arkansas Advocates for Children and Families explains the benefits of implementing a state EITC in this report.
- The EITC and the Refundable Child Tax Credit Are Critical to Women’s Economic Security- The National Women’s Law Center: Tax credits are important to build financial security, but this is especially true for female-headed households. This report explores different types of tax credits, and how they are helping women and kids across the county.
- EITC may prevent Child Abuse: Tax Credits for Working Families looks at a new report by the Centers for Disease Control and Prevention. In addition to a history of proven health improvements, this indicates that tax credits may also play a role in reducing child maltreatment.
- Brookings Institute EITC data: This resource has information on EITC eligibility and participation by state and zip code.
- EITC state fact sheets- Center on Budget and Policy Priorities: Arkansas-specific data on EITC data can also be found in the CBPP fact sheets.
- Cost of a state EITC in 2019- Center on Budget and Policy Priorities: The cost of enacting an EITC depends on how many people are likely to participate and what level of EITC a state chooses to enact. Information on the potential cost for 2019 is available in this report by CBPP.
And, as always, you can stay up to date on tax, budget and family economic security issues at the Arkansas Capitol by subscribing to our alerts and updates here.