Working-Family Tax Credits Gain Momentum in CO Legislature
By Chris Thomas, Public News Service – CO
DENVER – It looks like Colorado is on its way to giving lower-income families some guaranteed tax breaks, although a few stars have to align correctly to make it happen. On Monday, the Colorado House gave its final approval to a state Earned Income Tax Credit (EITC). It would be made permanent whenever the state has enough budget surplus to trigger a TABOR (Taxpayer Bill of Rights, Colorado’s state tax and budget restrictions) refund. And a Child Tax Credit (CTC) would kick in if Congress decides that Internet purchases should be taxed, which would give the state enough money for that credit.
Ali Mickelson, tax policy attorney at the Colorado Fiscal Institute, cautioned that neither tax credit is a sure thing at the moment – but in her view, that’s OK.
“Advocates for these credits in Colorado have been working on this in Colorado for ten years plus,” she said. “So, it’s an important move forward to even have the possibility of these turning on permanently, and for the legislators to recognize what important policy this is, and how important it is for Colorado families.”
Colorado has had an EITC and a CTC, but both had been set up as TABOR refund mechanisms, so families weren’t able to count on them, and the Child Tax Credit was eliminated. The current legislation (SB 1) was designed to make both credits permanent. It now goes back to the Senate for a final look.
Both types of credits are meant to keep a few thousand more dollars a year in the pockets of low-wage working families. In some cases, it’s enough to lift a family over the federal poverty line. But first, said Mickelson, the legislature wanted to be sure there’s a way to pay for them.
“It’s such a timely bill for Colorado and, as families are starting to recover, the economy is starting to recover, this is the type of tax policy that is effective and important in moving families out of poverty, into the work force,” she said.
Mickelson added that lawmakers were moved by the stories of Coloradans who testified for Senate Bill One that even a small amount makes a big difference in being able to afford necessities. The proposed tax credits would affect as many as 400,000 working families.
Find the full article and audio here: http://www.publicnewsservice.org/index.php?/content/article/32320-1
