A Senate panel agreed Monday to provide a bigger state income tax break for working families earning $45,000 a year or less during the 2013 tax year.
The Senate Ways and Means Committee voted 9-5 to boost the earned income tax credit, from the state’s current 7 percent tax credit to 20 percent of the federal tax credit for working poor families after turning back a Republican effort to broaden the break substantially.
Committee chairman Sen. Joe Bolkcom, D-Iowa City, said the 20 percent earned income tax credit contained in Senate File 88 would benefit about 210,000 Iowa households which are home to about 40 percent of the state’s children.
“This bill is what tax relief looks like,” said Bolkcom. “The tax relief is going to people who pay more than their fair share.” The bill’s manager said Iowa has a significant poverty issue and the tax relief targets those working families struggling to make ends meet.
What do you think of the measure? Is it enough? Do Iowa’s lower-income working families deserve a bigger tax credit from the state?