The 900,000 poorest working families in North Carolina just got another tax hike from the conservatives who swept state legislature elections in 2010.
The change took effect at the beginning of 2014, meaning that the taxes those families file this spring will be the last to feature the state’s tax break for the working poor. The provision, known as the Earned Income Tax Credit or EITC, will also be 10 percent less generous in its final year. State-level EITCs work by tacking on an additional benefit to the federal EITC, and the law repealing North Carolina’s EITC for 2014 also cut the credit from 5 percent to 4.5 percent of the federal benefit.
In order to qualify for the federal or state-level tax credit, tax filers must earn less than about $50,000. The goal of the credit is to buoy the incomes of working people whose employers pay them too little to provide the economic stability that having a job is supposed to ensure. Many conservatives who oppose other policies to boost poor peoples’ income, such as minimum wage hikes, support the EITC as an alternative way of keeping working people out of poverty without interfering with how private businesses operate.
But that argument didn’t carry the day among North Carolina Republicans, and lawmakers slashed and then eliminated the state’s EITC during last year’s legislative session. That change was overshadowed by the GOP’s broader changes to the basic shape of the income tax codein the state to favor the rich and harm the rest.
So yes, Republicans have no problem raising taxes on those who can afford it the least to give tax breaks to the wealthiest. North Carolina is now under a flat income tax of 5.8%, saving those making six figures or more thousands and those making seven figures tens of thousands in taxes.
In turn, that tax burden, along with the elimination of the state's Earned Income Tax Credit, just jacked up income taxes on the poor, big time.
Now combine this with the state's new draconian cuts to unemployment insurance in order to get the unemployed to leave the state and become someone else's problem.
"We had the ninth most generous unemployment compensation in the country and we were having a lot of people move here, frankly, especially in urban areas to get unemployment and then work other sectors and survive. So,people were moving here because of our very generous benefits, and then of course, we had more debt. So I think, personally, more people got off unemployment and either got jobs or moved back to where they were going or came from and quit the migration as much because of unemployment. We’ve seen this in other states where the benefits are very high, it could draw people from outside the state."
What happened of course is that since North Carolina now has the worst unemployment insurance in the country as of last summer, in turn they now have one of the highest rates of workers leaving the job market completely. What Republicans have managed to do is drive people out of the job market and into government programs. That's happening across the country, but it's happening faster in NC.
The GOP goal is to make being poor so awful that the poor just vanish, move away, or who knows? Die, maybe?
Either way, they're not the NC GOP's problem anymore.
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