Rep. Michele Bachmann (R-MN), who is campaigning for the 2012 GOP presidential nod, has already made it quite clear that she intends to raise taxes on the poorest Americans if elected. Today, she rolled out a new plan to hike taxes on those at the bottom of the income scale: eliminating the Earned Income Tax Credit.
In an interview with Fox News’ Neil Cavuto, Bachmann said she would “do away with the EITC,” and force someone who made only $3 to pay taxes on it:
This would be through the income tax system because the problem is, and this is where I deviate from Reagan, he instituted the Earned Income Tax Credit, it’s known as the EITC, and that effectively took many many Americans out of even having to pay any tax liability at all. I would do away with the EITC and if a person has $3 in income they would be subject to something. Obviously, no one has $3 in income. But they would have to pay something through that system.
The EITC is a tax credit for those at the lowest end of the income scale, going to families with children that make less than $36,000 per year (though the income level can vary depending on year and number of dependents). Individuals making less than $18,000 annually can also qualify for a small credit.
President Reagan called the EITC “the best antipoverty, the best pro-family, the best job creation measure to come out of Congress.” According to the Center on Budget and Policy Priorities, “research indicates that families mostly use the EITC to pay for necessities, repair homes, maintain vehicles that are needed to commute to work, and in some cases, obtain additional education or training to boost their employability and earning power.” And in recent years, the EITC has been essential in lifting families out of poverty:
The EITC reduces poverty by supplementing the earnings of workers with low wages and low earnings. There has been broad bipartisan agreement that a two-parent family with two children with a full-time, minimum-wage worker should not have to raise its children in poverty. At the federal minimum wage’s current level, such a family can move above the poverty line for an average family of four only if it receives the EITC as well as SNAP (food stamp) benefits.
In each of the last two years, the EITC kept 3 million children out of poverty. But Bachmann would eliminate it in order to tax those who make the least amount of money. At the same time, she has said that she is “open to” eliminating the corporate income tax.