SACRAMENTO, Calif. (AP) - Gov. Jerry Brown will propose offering a $380 million tax credit for the working poor when he releases his revised budget Thursday, a proposal the Brown administration said could help as many as 2 million Californians.
The tax credit would offer assistance to households with income less than $6,580 with no dependents or up to $13,870 for those with three or more dependents. It was first reported by the Los Angeles Times.
Brown has been under pressure from fellow Democrats and social welfare groups to spend some of the surplus revenue pouring into state coffers this year as California rebounds from the recession. He has mostly opted for a restrained approach, urging caution on spending new revenues.
The governor’s new tax proposal is similar to an effort by Assembly Speaker Toni Atkins, D-San Diego, who told reporters last week that she would propose a similar plan to aid low-income working families.
Brown’s administration says the average tax credit would be $460 a year with a maximum credit of $2,653. It mirrors a similar federal tax credit program. The administration said it would benefit up to 825,000 families and 2 million individuals.
Assemblywoman Shirley Weber, D-San Diego, chairwoman of the Assembly Budget Committee, said last week that the proposal she and Atkins were studying would be a targeted program aimed at lifting thousands of people out of deep poverty.
“That gets us to our speaker’s philosophy that people who work every day should not live in poverty,” she said. “Those who have full-time employment should at least have the things that are essential to live to encourage people to want to work.”
Amanda Fulkerson, spokeswoman for Assembly Minority Leader Kristin Olsen, R-Riverbank, said in an email that Brown’s tax proposal merits consideration, “but it will not end widespread poverty.”
“Our state has the highest poverty rate in the nation, so we should absolutely consider every policy that helps the most economically vulnerable, especially those that are working and still struggle to make ends meet,” she said.
Brown proposed a record $113 billion general fund spending plan in January, but he is revising that upward on Thursday as the state has collected more revenue. The state controller’s office reported Monday that tax collections are running $3.4 billion above his forecast, with personal income tax accounting for $2.7 billion of the windfall.
By voter-approved law, the state must spend the lion’s share of the surplus on public schools and filling California’s savings account, but Democrats who control both houses of the Legislature are seeking to spend what’s available on social service programs and higher education.
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