Group: Tax credit change would aid 500,000 Iowans

DES MOINES (AP) — An advocate for expanding a working-class tax cut backed by Democrats told state lawmakers Thursday that more than 500,000 Iowans would likely benefit from the change.

Charles Bruner, executive director of the liberal tax policy group the Child and Family Policy Center, told members of the Senate Ways and Means Committee on Thursday that 250,000 adults and 265,000 children could see an increase in the credit.

However, it’s unclear whether Republicans will support the measure, which is similar to one the Legislature approved twice last year — both times vetoed by Gov. Terry Branstad.

Julie Heck, a single, working mother of three from Pleasantville, also spoke before the panel, telling lawmakers the additional $140 she’d receive under the measure would mean a lot to her family.

“It may seem like a small number, but it’s very significant,” Heck said.

Democrats want to nearly double the credit, which provides tax relief for working-class families and individuals, at a cost of about $25 million.

“The biggest unfairness in my mind in our overall tax code is the way we treat working families with children like Julie’s,” said Bruner, a former state legislator.

The credit currently maxes out at $379 a year for a married couple with three children making about $43,000 a year, or $32 for a single adult making up to $13,450.

Sen. Joe Bolkcom, an Iowa City Democrat, said expanding the credit would provide long overdue tax relief for hard-working families. And as chairman of the Senate Ways and Means Committee, Bolkcom has vowed to shelve all other tax talk until the House, Senate and Branstad approve the expansion.

“I can’t think of a more important tax cut to focus on right now than this improvement in the earned income tax credit,” Bolkcom said.

House Speaker Kraig Paulsen, a Hiawatha Republican, stopped short of endorsing the measure Thursday, a smaller version of which the Republican-controlled House approved twice last year. And Branstad, who said he vetoed the measure to include it in a larger discussion of taxes, hasn’t indicated whether he’ll give in to Bolkcom’s demands.

Bruner thinks there will be support from lawmakers and the governor to increase the tax credit this year, noting Branstad signed the first earned income tax credit into law in 1989.