Using the Earned Income Tax Credit to Stimulate Local Economies

While the Earned Income Tax Credit has traditionally been viewed as an anti-poverty policy, Alan Berube, from the Brookings Institution, offers insight into how the EITC can have significant effects on local and regional economies. In San Antonio, it is estimated that each one dollar in EITC would generate a further 1.58 dollars in local economic activity. Similarly, a recent study in Baltimore found that EITC dollars generate close to 600,000 dollars in local income and property tax revenues.