Sending Office: Honorable Ro Khanna
Sent By:
Chris.Schloesser@mail.house.gov

In September, Sen. Brown and Rep. Khanna will introduce legislation authorizing a large expansion of the EITC. My boss would welcome you Member’s cosponsorship. Let me know if you have questions or concerns. Thanks so much for the consideration and have
a good day, Chris

 

For Many, Wages Have Been Stagnant Since 1979:

Let’s Raise Wages Through an Expansion of the EITC

Original Cosponsors (38): Reps. Beatty, Beyer, Brady, Brownley, Butterfield, Cartwright, Clarke, Cohen, Conyers, Cummings, DeFazio, Delaney, Evans, Fudge, Gonzalez, Grijalva, Hanabusa, Jackson Lee, Jayapal, Kelly, Lee, Moore, Nadler, Napolitano, Norcross,
Norton, Pallone, Raskin, Rush, Ryan (D-OH), Schakowsky, Scott (D-VA), Serrano, Velazquez, Waters, Watson Coleman, Welch, Wilson (D-FL)

August 11, 2017

Dear Colleague:

Please join me in sponsoring a transformational expansion of the Earned Income Tax Credit (EITC) to compensate for the loss of wages of the bottom twenty percent of wage earners since 1979. Senator Sherrod Brown will be introducing companion legislation
in the United States Senate.

As you know, the EITC is a refundable federal income tax credit for low-income working individuals and families. The EITC is designed to “make work pay” by supplementing low-wage work to benefit both workers and their dependents that may rely on limited
income. This tax credit has enjoyed broad bipartisan support over the years with Presidents of both parties signing major EITC expansions into law.

In recent years, there have been expansion efforts by then Speaker Ryan, Ways and Means Committee Ranking Member Neal, and former President Obama. In fact, I’m a proud cosponsor of RM Neal’s H.R. 822, the Earned Income Tax Credit Improvement and Simplification
Act. Their aim, and the next step to strengthening the EITC, is to increase the credit for childless workers to an amount closer to that for families with children to augment the direct work incentive and help counter poverty among the working poor.

Wage stagnation over the past several decades has excluded households in the 20th percentile of the income distribution from a 68% growth of GDP per person. Wages have only increased by 6.9%—not nearly enough to ensure every hard-working American is fairly
compensated for their labor. Crafted with assistance from the Center on Budget and Policy Priorities and evaluated by the Urban-Brookings Tax Policy Center and the Center for American Progress, this expansion of the EITC will jumpstart consumer demand and
increase overall economic growth. As stated by
Neil Irwin describing a similar plan
, the EITC expansion will “replace every dime of income that the bottom 20 percent of earners have lost compared with the average family since 1979.”

This bill seeks to address the most glaring issue with the current EITC, which is its almost complete exclusion of childless adults due to the credit being so small. This expansion proposal significantly increases the amount of credit available for childless
workers and gives working families an overdue tax break. The legislation would increase the maximum credit from:

  • $510 with no qualifying children to $3,000;
  • $3,400 with one qualifying child to $6,528;
  • $5,616 with two qualifying children to $10,783; and
  • $6,318 with three or more qualifying children to $12,131.

Given Americans live pay-check to pay-check, the expansion includes a provision that would provide an Early Refund EITC. Advances would be capped at $500 and subtracted from the recipient’s annual EITC credit. An early refund makes it easier for folks to
pay their monthly bills rather than receiving a lump sum once a year and having to rely on payday loans.

We need more than incremental policies to help American working families. While the EITC expansion is a good first step, it must be coupled with other bold ideas such as an increase in the minimum wage and stronger collective bargaining rights for workers.
These bold initiatives together are needed to fully address the critical issues facing working Americans.

If you would like to be an original cosponsor or have any questions, please contact Chris Schloesser in my office at
Chris.Schloesser@mail.house.gov.

Sincerely,

/s/

Ro Khanna

Member of Congress

 

Related Legislative Issues
Selected legislative information: Family Issues, Labor
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