New Jersey’s EITC Increases to 30 Percent
June 29, 2015Print
New Jersey Gov. Chris Christie (R) has taken a red pen to the state budget once again. Only this year, he did not line-item veto an increase for the Earned Income Tax Credit (EITC) and even went as far as to suggest an even larger credit as an alternative, a proposal that state lawmakers gladly accepted just moments ago.
After reviewing the $35.3 billion budget plan, which raised taxes on corporations and the wealthy to fund projects such as expanding the EITC from 20 to 25 percent of the federal credit, Christie announced that while he opposed raising taxes for the wealthy, he was in favor of lowering taxes for the state’s working poor. In a conditional veto of the “millionaire’s tax,” Gov. Christie proposed increasing the state’s EITC to 30 percent.
While New Jersey policy groups applaud the governor’s EITC increase, they must be scratching their heads at his sudden change of heart. Christie, expected to formally announce his candidacy for the 2016 presidential race this week, has had a rocky history with the EITC. In 2010, Gov. Christie signed into law a bill to decrease the state’s credit from 25 to 20 percent of the federal credit. In 2011, he line-item vetoed provisions that would have reversed the cuts made to the credit. After facing criticism for raising taxes on low-income workers, Christie pledged to restore the state’s EITC in his 2012 State of the State address, but continued to veto the credit in favor of across-the-board income tax cuts.
Now, Gov. Christie’s 30 percent EITC will provide more than 1/2 million New Jersey workers and their families with a much-needed tax break, according to New Jersey Policy Perspective. Boosting these workers’ take-home pay will help them cover the cost of living and raising a family in one of the top five most expensive states, put more money back into local businesses and help New Jersey’s economy thrive.