Gov. Chris Christie signed into law yesterday a measure that hikes a tax credit for the state’s low-income wage earners. The increase of the state’s Earned Income Tax Credit will affect roughly 500,000 New Jersey households, providing an additional $210 annually to the average working family that qualifies for the credit, according to Christie’s office.
Christie, a second-term Republican, announced his plans to bump up the credit late last month after Democrats who control the Legislature sent him a bill to increase the EITC. That was just the latest attempt by Democrats to reverse a cut to the same program that the governor enacted shortly after taking office in early 2010, when the state was still in the midst of the recession. At the time, he lowered the credit from 25 percent of the federal version to 20 percent.
Under the measure approved yesterday by Christie, who is now running for president, the state credit will increase to 30 percent of the federal credit, putting New Jersey on par with New York. The change will apply to the 2015 tax year and beyond.
Income eligibility for the credit ranges from $14,590 for workers without children to $52,247 for those with three children or more, according to New Jersey Policy Perspective, a liberal think tank that has worked for years to boost the credit.
Reaction from Christie: “This is something that those families need now more than ever. They need more money in their own pocket and less in the pockets of politicians for them to spend on their special-interest friends here in Trenton.”
[related]Reaction from Democrats: “This will make a real difference in the lives of those who work hard but struggle to support themselves and their families. It will put money in their pockets and provide a boost to the economy,” said Sen. President Stephen Sweeney (D-Gloucester). “I wish the governor recognized the needs of the working poor over the past five years when he reduced the tax credit and repeatedly vetoed our legislation to restore it. He effectively raised taxes on those who could afford it the least.”
“The governor’s action on this issue is the right thing to do, but the right time to do it was years ago,” said Assembly Speaker Vince Prieto (D-Hudson). “Working people in New Jersey — men and women who want nothing more than to be able to support their families — deserved much better than being reduced to annual victims of the veto pen. Democrats always recognized that.”
“The sad reality is this — whether it is New Jersey’s lagging economic recovery, our skyrocketing property tax burden or our struggling middle-class families — Chris Christie’s 2016 presidential ambitions have all too often come at the expense of millions of New Jersey residents,” said Assembly Majority Leader Lou Greenwald (D-Camden). “So although I welcome Chris Christie’s sudden about-face on the EITC, we have much more work to do in order to reverse the damage our state has suffered as a result of governing by soundbites instead of working for real solutions.”
Reaction from New Jersey Policy Perspective: “The restoration and increase to the New Jersey EITC is overdue and warmly welcomed,” said Gordon MacInnes, president of the Trenton-based think tank. “The only group of New Jerseyans to suffer a tax increase in the wake of the Great Recession were working families at the bottom of the income scale. These families are barely hanging on as it is. Increasing the EITC is the swiftest way to give them and their children a better chance in high-cost New Jersey.”