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N.J. Lawmakers Vote To Expand Tax Credit For Working Poor

NJ.com — Monday, June 29, 2015

By Samantha Marcus | NJ Advance Media for NJ.com

TRENTON — The state Legislature on Monday voted to expand a popular tax credit for low-income workers, taking Gov. Chris Christie up on an offer that accompanied his vetoes of the Democratic state budget late last week.

The bill increases the Earned Income Tax Credit from 20 percent to 30 percent of the federal credit and will return hundreds of dollars a year to New Jersey's working poor.

The expansion will benefit roughly a half million New Jerseyans, who will receive $250 more a year, on average. Three quarters of families earn less than $20,000 a year, according to a report issued Monday by liberal think tank New Jersey Policy Perspective.

As part of a measure raising taxes on income over $1 million, Democrats had proposed to raise the EITC from 20 percent to 25 percent in their budget, reversing Christie's 2010 cut to the program. On Friday, Christie vetoed the tax on the wealthy, but suggested the state increase the EITC by 50 percent.

"This is something those families need now more than ever," Christie said Friday. "When I said I want to cut taxes for everyone, I want to cut taxes for everyone... We're now going to cut taxes for the working poor in this state."

The Assembly on Monday approved the expansion 62-2-4, and the Senate 38-1, dropping their own millionaires' tax in the process.

But in the Assembly's last session before summer break, lawmakers couldn't resist exchanging some parting shots: Republicans "thanked" Democrats for seeing the harm in raising taxes on the wealthy, while Democrats congratulated Republicans for "finally recognizing" the merits of the EITC.

Assembly Majority Leader Lou Greenwald (D-Camden) said it was about time lawmakers "do right by the hardworking men and women."

In a Statehouse news conference on a different matter, Democratic leaders dismissed the suggestion that they would let the possibility of handing the governor a political talking point on the eve of his presidential campaign announcement sour the attractive offer.

"I can care less about sound bite," Senate President Stephen Sweeney (D-Gloucester) said, quipping that Christie had managed to "out-Reagan Ronald Reagan," who championed the tax credit.

Regardless of the governor's motivations, "if something good comes out of it, we're rejoicing. We're celebrating," Senate Majority Leader Loretta Weinberg (D-Bergen) said. "It is fair. It is appropriate. And you know what, it'll help the economy."

Democrats had been unsuccessful in trying to restore the tax credit, which Christie has used as a bargaining chip in negotiations over income taxes and the minimum wage.

Essex, Middlesex and Camden counties have the the largest concentration of recipients, NJPP said, noting that even wealthy counties have more than 10,000 recipients.

"The EITC, traditionally a strongly bipartisan measure, is perhaps the most powerful anti-poverty took available, with widespread and significant effects on families who receive it," NJPP said.

While praising the increase in the tax credit, New Jersey Citizen Action said it will not "erase five years of damage caused by Christie's tax hike on our poorest and most vulnerable citizens."

"Raising the EITC will make a real difference in the lives of over a half million of New Jersey's working families," said Citizen Action's executive director, Phyllis Salowe-Kaye. "We are pleased that the governor has reversed his obstinate refusal to fund this bi-partisan tax credit."

reasons or because those services were available elsewhere, but in a February appearance before a national conservative group he connected the vetoes to his anti-abortion beliefs. The Democrats' budget again includes $7.5 million for those clinics, which include some run by Planned Parenthood.

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