The current pandemic has both highlighted and exacerbated racial, wealth and health disparities in our communities. It has also laid bare the structural barriers that far too many families confront in access to public relief and support programs. Immigrants face disproportionately high exposure to both the health and economic effects of COVID-19, as they are both overrepresented among essential workers who risk getting sick every day they go to work, and also make up a disproportionately large share of workers in the service sector industries that have experienced the most job losses due to the pandemic.
While the response to COVID-19 has exposed immigrants’ heightened vulnerability to health and economic crises, excluding immigrants from public programs is not unique to the current pandemic.
There are several policies in place to support New Jersey residents when they fall on hard times; however, certain immigrants facing the same challenges are largely denied access to this safety net. Immigrants without a Social Security number face particularly difficult circumstances. The federal government has intentionally excluded these immigrants — including 686,000 in New Jersey — from pandemic relief, including the $1,200 stimulus payments under the CARES Act. Undocumented immigrants are also ineligible for unemployment benefits, even though they pay into unemployment insurance trust funds just like any other worker.
A broader pattern of discrimination
Being left out of COVID-19 relief is not the only way that immigrants are being excluded from supports available to most other New Jerseyans. Rather, a legacy of discriminatory policy decisions leaves immigrants disproportionately vulnerable to crises — the coronavirus included — without economic relief.
Now, as many of these immigrants lose their jobs or a portion of their wages at no fault of their own, they face additional challenges as they are excluded from both the broader safety net that many other New Jerseyans benefit from, and relief programs specific to the immediate impacts of the pandemic. These exclusions compound inequities in access to government programs that existed long before the current crisis. Rectifying these inequities will require not only immediate assistance, but also structural changes, including a more inclusive tax code.
Disparities in wealth have increased since the onset of COVID-19, and many affluent households who already pay a disproportionately small share of their income in taxes have accumulated even more wealth during the pandemic. Instead of creating policies that perpetuate and further entrench existing inequities, lawmakers should strive to create policies that are more equitable than those in place going into the pandemic.
Tax credits would boost families, economy
One step New Jersey lawmakers can take to create a more just tax code is to remove arbitrary barriers to critical programs like the Earned Income Tax Credit. The EITC is a proven tool for lifting workers out of poverty and supporting state and local economies. However, its narrow eligibility requirements prevent it from being as effective as it could be. Immigrants without a Social Security number are barred from receiving the EITC, even if they file taxes using an Individual Taxpayer Identification Number.
By extending the New Jersey EITC to qualifying households who file taxes using an ITIN, the EITC could support an additional 54,000 households struggling to make ends meet and serve as a more powerful economic stimulus. EITC claimants typically spend most of the credit to meet short- and intermediate-term needs like transportation, utility bills, and household supplies — meaning these funds are spent both immediately and locally.
By increasing the spending power of households who need it, expanding the EITC would not only support the health and well-being of New Jerseyans, but also inject millions of dollars into local economies across the state at a time when they could really use it.
Barriers to emergency response, EITC
New Jersey legislators have already begun efforts to address these gaps by introducing legislation that would allow taxpayers with an ITIN to qualify for the EITC (A-4229/S-2194) as well as a bill that would provide a one-time payment to certain households who filed taxes and were excluded from federal pandemic relief (S-2480/A-4171). Still, hearings have not been held for either proposal.
As New Jersey recovers from unprecedented health and economic challenges, we are missing out on opportunities to send a much-needed boost to local economies across the state and to improve the economic security and well-being of families who are struggling to make ends meet.
By taking steps to ensure support for New Jersey residents excluded from pandemic relief and addressing inequities in our tax code, state lawmakers can support families at the margins of poverty, challenge anti-immigrant bias and racism, and build a foundation for a stronger recovery from the COVID-19 pandemic.