State policymakers have significantly expanded California’s Earned Income Tax Credit — the CalEITC — since the credit was first enacted in 2015. However, hundreds of thousands of immigrant families are excluded from benefiting from the CalEITC as well as from California’s new Young Child Tax Credit, which is tied to CalEITC eligibility.
The California Budget & Policy Center’s guide, The CalEITC and Young Child Tax Credit: Smart Investments to Broaden Economic Security for Californians, provides an overview of how refundable state income tax credits help people who earn little from their jobs to pay for basic necessities and support families, children, and communities.
California has been a national leader in helping people receive the health coverage they need since the enactment of the federal Affordable Care Act (ACA) in 2010. Until 2016, the share of Californians without health coverage dropped substantially. But this decline slowed significantly before finally stalling out in 2018, leaving close to 3 million Californians uninsured.
New Census figures released today show rising income inequality across the state and millions of California residents who are struggling to get by on extremely low incomes, while higher-income households experienced more income growth. Even as the latest figures also show there is a decline in the official poverty rate in California, these findings underscore the need for policymakers to ensure that the benefits of California’s strong economy and recent economic growth are shared among all Californians.
Approximately 7.1 million Californians lived in poverty each year from 2016 to 2018 – more than 1 in 6 state residents (18.2%) – according to new Census data released this morning based on the Supplemental Poverty Measure (SPM). The high cost of living in many parts of California is a key reason for California’s high SPM poverty rate, underscoring the continuing need for policies that address the state’s affordability challenges. High living costs are particularly problematic when they rise faster than incomes. This presents a challenge in California because inflation-adjusted wages in recent decades have grown only for the highest-paid workers, while wages for mid-wage and low-wage workers have remained largely flat.