Hatfield helps pass tax break for working families

OLYMPIA – In the last vote before the cut-off deadline, the Senate passed Senate Bill 6809, by a vote of 32 to 16, which will provide working families with a tax break based on the Earned Income Tax Credit. Sen. Brian Hatfield, D-Raymond, co-sponsored the measure.

“This tax break is going to help the hardest working families in Washington. I’m excited this groundbreaking bill passed the Senate,” said Hatfield.

Senate Bill 6809 follows the model used in 23 other states and provides eligible families a state percentage payment of their federal Earned Income Tax Credit (EITC). If SB 6809 is enacted, Washington would become the only state in the nation without an income tax to provide a state percentage payment of the federal EITC. The percentage would function as a rebate on a family’s paid sales taxes.

“This tax break is going to the folks that need it the most. It’s not a huge windfall for the rich like the Bush tax cuts. This is going to help pay for things like shoes and winter coats for kids,” said Hatfield.

The bill would authorize the beginning of the administrative process, setting up the program with a 5 percent (or minimum twenty-five dollar) payment for FY 2010 and 2011, then stepping up to a 10 percent (or minimum fifty-dollar) payment after that. Administratively, the state Department of Revenue (DOR) would obtain EITC recipient data from the IRS and notify potentially eligible recipient, who could then apply online or otherwise. Because there is no current system in place to administer the program, there would be only a minimal fiscal impact from SB 6809 this biennium. The cost of the bill this biennium would be $2.3 million for administrative set-up.

Following Tuesday’s vote, SB 6809 moves on to the House, where it must be passed by March 7th in order to become law.

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