Raleigh, N.C. — The state House gave key approval Tuesday to legislation that would eliminate a state tax credit for low-income workers at the end of this year.
The demise of the earned-income tax credit was included in House Bill 82, which updates sections of the federal tax code for North Carolina taxpayers.
The bill passed 75-41 on second reading. A final House vote is expected Wednesday.
Democrats pointed to the bill as the latest example of what they call a "war on the poor" by the General Assembly, following recent bills to slash unemployment benefits and block Medicaid expansion.
"People say you do policy either with a carrot or a stick, and we have pretty much pulled the stick out pretty well during this session," House Minority Leader Larry Hall said.
Rep. Deborah Ross, D-Wake, criticized the House for ending the EITC only one day before a committee considers legislation that would abolish an inheritance tax, which would benefit wealthier individuals and families.
"It's a small amount of money that makes an enormous difference in people's lives – people who are living at the edge, people who are working," Ross said, noting one family used their EITC money to place a down-payment on a mobile home so they would have a place to live.
The House looked at dropping the EITC last year as part of a tax reform effort but decided to extend it for one more year, said Rep. Julia Howard, R-Davie.
"It is in our best interest not to extend it further," Howard said.
Hall, D-Durham, noted that lawmakers haven't yet taken up tax reform, so there is no reason to eliminate the EITC from those debates ahead of time.
Rep. Paul Luebke, D-Durham, tried to amend the bill to extend the EITC for another five years, but his proposal failed 74-42.