Thursday, April 4, 2013

House tax leader says no to Senate-approved bill to cut Earned Income Tax Credit

By SCOTT ROTHSCHILD, The Lawrence Journal-World

The Kansas House's tax leader on Wednesday rejected a Senate-approved bill that would cut nearly in half the state portion of the Earned Income Tax Credit, which is aimed at helping low-income, working families.

Rep. Richard Carlson, R-St. Marys, and chairman of the House Taxation Committee, said the cut in the EITC was too controversial to consider at this time.

On Tuesday, the Senate approved cutting the EITC by approximately $40 million and shifting those revenues to expand the Homestead Property Tax Refund program.

Supporters of the move said the legislation would help low-income homeowners and senior citizens on fixed incomes. They said some people were losing their homes because they couldn't pay their property taxes.

Opponents of the bill said it was taking money from one group of poor people to give to another group of poor people.

The measure was approved in the Senate, 25-15, with only Republican support.

But Carlson, who is currently negotiating with the Senate on several major tax proposals, said the cut in the EITC was too controversial in the House and would weigh down other tax bills if put in one package.

Sister Therese Bangert, of the Sisters of Charity of Leavenworth, who has been fighting to preserve the EITC said she was happy to hear Carlson's comments.

"It thrilled me to hear the House say they're not interested in trading off the Earned Income Tax revenues for the Homestead Property Tax."

She added, "I hope this will push the Legislature to look at the issue — if indeed the elderly are losing their homes because of high property tax rates — I hope they will look at that."

More than 200,000 Kansas families receive the EITC and the average state portion is $389 per household. The bill would have reduced the Kansas EITC from 17 percent of the federal credit to 9 percent.