Some Republican state legislators are pushing their colleagues to support the fraud plagued Earned Income Tax Credit (EITC). It isn’t even a tax credit. It is a redistribution of wealth disguised as a tax provision. Even if you are a liberal who wants to redistribute wealth EITC is not the way to do it. There is a federal EITC and the IRS says it is so bad that between 21 percent to 26 percent of federal EITC claims are paid in error, with much of it being due to fraud.
How bad is EITC and how do people scam it? Check out our article Pro Fraud and Waste Law Proposed.
Why would a Republican push this mess in Arkansas?
EXCUSE 1. “We need to pass EITC to get Democrats onboard to vote for income tax cuts in a special session later this year.” If you passed math in the first grade you know this argument is bogus.
Let’s add it up. Passage of an income tax cut only requires a simple majority vote and Republicans have a SUPERMAJORITY in both the Arkansas Senate and House of Representatives. This means an income tax cut can be passed without any Democrat votes and even without the votes of some RINOs. Besides, who is going to vote against tax cuts right before primary elections after voting to raise taxes 2019 and while the state amassed almost a billion dollar general revenue surplus in tax revenue last fiscal year.
But what about needing more votes to pass an emergency clause to allow the tax cuts to become effective immediately? An emergency clause is not needed. Next year’s income tax is not due for months and once tax cuts pass the Arkansas Revenue Division has just as much time to prepare whether the income tax cuts go in effect immediately or ninety-one days later.
The excuse of needing Democrat votes is FAKE.
EXCUSE 2. The next excuse we are hearing is, “EITC is not a stand-alone bill it is part of a bigger tax package that will lower income tax rates and we need to pass the bill.”
What? That makes no sense either. That would be like saying you bought a set of new tires and one tire was defective but you bought it anyway because it was a set. You don’t buy tires that way and legislators don’t have to pass legislation that way either. EITC can be amended out of the bill with just a majority vote. Or a better and quicker solution is to file another bill without the fraud plagued give away in it and pass a good bill.
LET’S REVIEW. It is not about needing Democrat votes and there is no reason to vote for a bill with bad provisions like EITC in it. So, what is really going on here? Who are they really trying to appease?
It has been suggested to us that EITC is being pushed by Walmart (Wokemart). We don’t know if this is true or not but these legislators are trying to please someone and it is not the people who pay income tax. Based on Walmart’ success just weeks ago in the extended legislative session and in previous sessions of the legislature, if Walmart decides to push EITC many legislators will fall in line no matter how much fraud and waste it brings.