Letter to the Hon. Nancy Pelosi, Speaker of the House and the Hon. Kevin McCarthy, Minority Leader - Letter Urges Expansion of Earned Income Tax Credit, Child Tax Credit to Help Working-Class Michigan Families

Letter

Dear Speaker Pelosi and Leader McCarthy,
We are very grateful for your strong leadership in shepherding critical emergency legislation
through Congress to help address the urgent health and economic needs as a result of the global
pandemic. But as you know, Congress must do more.
The economic havoc brought about by the coronavirus pandemic will have wide-ranging and
long-lasting effects, especially on low-wage workers, children and their families. The
Congressional Budget Office (CBO) expects unemployment to rise to 16 percent this year and
then hold at levels close to 10 percent through the end of 2021. More aggressive policy steps
must be taken to get the economy back on track especially for low-income workers. To help
address this, we urge you to include a temporary expansion of the Earned Income Tax Credit
(EITC) and the Child Tax Credit (CTC) in the next coronavirus legislative package, to take effect
for tax year 2020.
Improving the EITC and CTC would deliver a well-timed boost to the economy and help
millions of people early next year while encouraging and rewarding their hard work and helping
many from sliding into poverty because of this crisis.
The EITC is a success story because it encourages people to work, when it is safe to do so after
the peak of the pandemic and provides a financial boost to low-wage workers and their families.
However, gaps in EITC mean that millions of people are left out. For example, low-wage seniors
over 64 and the youngest adult workers not raising children receive zero EITC benefit. In all,
five million low-income workers without children are taxed deeper into poverty.
Across our country, we have seen the importance of people, both with and without children, who
do essential jobs but are paid too little. An expanded EITC would provide additional income to
supplement their limited earnings. Among the people who would benefit the most from a robust
EITC are grocery store cashiers, health-aides, and truck drivers -- workers on the front lines of
coronavirus. We must fill the existing gaps and increase the size of the credit.
The current economic downturn is also likely to have an outsized impact on one especially
vulnerable population--children. The coronavirus pandemic has left more children and families
with less access to essential support due to the closing of schools and daycares. We need to do all
we can to avoid a spike in child poverty, which would do harm to the prospects of millions of
children for years to come. Even before the current crisis, the CTC failed to fully reach
approximately 26 million children in low- and moderate-income families due to the CTC being
not fully refundable. The next crisis response bill should change that and provide the full credit
to all eligible families.
We must respond to this unprecedented challenge with policies that provide support to the
workers and families who will be hit the hardest and affected the longest by this crisis. Doing so
also serves as effective economic stimulus, delivering efficient results to American taxpayers.
Legislation that we are sponsoring this Congress, the Our Working Families Tax Relief Act,
provides the model for making these critical improvements to the EITC and CTC. Working
families are depending on us to meet this extraordinary moment by providing them with the
support they need to weather the ongoing economic effects of COVID-19 in the years to come.
We must deliver for them.