Low-income Mainers are some of the most vulnerable residents in our state. Meager earnings from low-wage jobs often leave families struggling to put food on the table, pay bills, and cover other basic living expenses. For thousands of working Mainers, these financial strains have only worsened as a result of the COVID-19 pandemic and rising inflation.
Thankfully, our leaders in Augusta are working hard to ease this burden. As part of the state’s $1.2 billion budget passed last week, Maine has expanded the Earned Income Tax Credit to support our working families.
The Earned Income Tax Credit (EITC) is an anti-poverty tax policy that reduces the taxes owed by low and moderate-income families. It provides eligible filers with a refundable tax credit, increasing their access to housing, childcare, food, and other necessities. This year’s budget puts aside $27.6 million to boost that credit, increasing the maximum benefit by an average of $400 per family for a total average benefit of $764 a year.
The Center on Budget and Policy Priorities estimates that over 97,000 low and moderate income Mainers claimed the federal EITC in 2019, receiving an average credit worth more than $2,000. By expanding Maine’s EITC, lawmakers are lifting more families out of poverty and boosting the local economy in the process.
As things stand, most Mainers are set to receive $850 checks as early as June 2022 as part of the recovery effort. But by additionally expanding the EITC, lawmakers are taking a more targeted approach to solving some of the biggest challenges facing low and midde income families.
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