Research

EITC's Impact on Workers Who Don't Qualify

June 27, 2019
EITC's Impact on Workers Who Don't Qualify Image credit: www.gotcredit.com

The Earned Income Tax Credit (EITC) can cause wage declines for workers who do not receive the tax credit. 

If EITC recipients compete in the same labor markets as others who are ineligible for the credit, such as older workers, this can cause wage declines for workers who do not receive off-setting EITC payments. The study concludes that EITC's capacity to redistribute income is limited, and it further weakens workers' ability to bargain for better wages and working conditions. 

Author: Aida Farmand
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