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The bill, introduced Tuesday by Reps. Mike Carey, R-Ohio, and
Danny Davis, D-Ill., would expand eligibility for the Earned
Income Tax Credit to workers over the age of 65. Currently, only
workers between the ages of 25 and 65 may claim the credit.
“America’s workforce has changed since the EITC was established
in 1975. Many Americans are working longer, and a rising
retirement age should be reflected in the program,” Carey said.
“Certain Americans should not be prevented from accessing
critical tax provisions because of their age.”
Worker advocacy organizations including Golden State Opportunity
and the Critical Labor Coalition have endorsed the bill, with
Misty Chally from CLC saying the legislation “encourages those
with experience and a strong work ethic to reenter the workforce
at a time when employers need them the most.”
But tax policy experts have raised concerns that expanding the
EITC, which is 95% spending outlays, is a fiscally risky move,
particularly as Congress plans to spend trillions expanding
other Trump-era tax policies.
Adam Michel, director of tax policy studies at the Cato
Institute, told The Center Square Wednesday that the
“countervailing incentives” of the EITC, coupled with the cost
of the program, “lead to ambiguous total economic effects.”
“The EITC is usually described as creating an incentive to work,
however, as the credit phases out it also disincentivizes
additional work hours and the pursuit of higher-paying jobs,”
Michel said. “Rather than expanding the credit, Congress should
repeal it in favor of lower tax rates for everyone.” |
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