Let’s Talk About the Women’s Wealth Gap
March 11, 2020Print
In 2018, we wrote about how expanding the Earned Income Tax Credit (EITC) and Child Tax Credit (CTC) could help to address the women’s wealth gap. Two years later, policymakers have yet to improve the two credits at the federal level, and the gap persists.
On average, women in America are paid only 82 cents for every dollar paid to men, according to the American Association of University Women (AAUW), and at the current rate of progress, the pay gap will not close until 2093. This gap widens even further for women of color: compared to white, non-Hispanic men, black women earn 62 cents on the dollar, American Indian or Alaska Native women earn 57 cents, and Hispanic women earn 54 cents.
As these inequities persist, research on how programs within federal and state tax codes can be leveraged as tools to advance racial and gender equity has grown. A recent report from the National Women’s Law Center recommends building on the successes of tax credits like the EITC and CTC. Although the two aren’t a silver bullet for addressing the gender pay gap, research shows that the income boost from these credits can help offset the wage disparity and move women – especially those of color — closer to financial security.
The EITC and CTC not only provide an income boost for working women, they also help to improve health and educational outcomes. The credits are linked to improved maternal and infant health, better school performance and greater college enrollment among children of recipients, and increased retirement benefits for women.
TCWF is committed to building economic opportunity for all women by promoting tax credits for low-wage workers at the state and federal levels. Working on the women’s wealth gap? Tell us about your work here. Let’s work together to make the tax code more equitable for everyone.