California’s refundable tax credits for low-income residents make up a small fraction — less than 2% — of the state’s nearly $80 billion of tax breaks, which disproportionately benefit profitable corporations and the wealthy.
California’s three refundable tax credits — the California Earned Income Tax Credit (CalEITC), the Young Child Tax Credit, and the Foster Youth Tax Credit — are the only credits that benefit people with very low incomes.
Yet, these credits make up less than 2% of the nearly $80 billion total cost of state tax breaks for individuals and businesses. Many of these other tax breaks largely benefit high-income individuals and profitable corporations.
Everyone deserves an opportunity to achieve economic security. State leaders can make the tax system more fair by expanding credits that reach Californians with low incomes.