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This January 1st, two laws will take effect that will significantly improve the wages and incomes of working people in the Commonwealth.
While wages for low and middle-income workers have been stagnant for decades, in the last two years the State Legislature and the Governor--responding to people organizing across the state--enacted laws increasing the state minimum wage and the state Earned Income Tax Credit (EITC).
On January 1st, the minimum wage will increase to $10 an hour. This is part of a scheduled set of increases that will bring the minimum wage up to $11 an hour in 2017. Going to $10 an hour will raise the wages of about 450,000 working people in the Commonwealth. For more information, please see MassBudget's factsheet The Effects of a $10 Minimum Wage in 2016.
The state Earned Income Tax Credit will also increase on January 1st (from 15 percent of the federal credit to 23 percent), raising the incomes of roughly 440,000 households in the Commonwealth. In 2016, the maximum value of the state EITC will increase to $1,442, a gain of $502 over what it would have been ($940) if the EITC hadn't been increased. MassBudget's factsheet Massachusetts's Earned Income Tax Credit provides data on the direct effects of this increase and on the long-term effects on lower-income children when their family income improves. Town-by-town data on the number of people claiming the EITC is provided HERE.
For more info on the minimum wage:
- MassBudget factsheet: The Effects of a $10 Minimum Wage in 2016
- MassBudget factsheet: The Minimum Wage in Massachusetts: Challenges & Opportunities
- MassBudget factsheet: The Regional Impact of an $11/Hour Minimum Wage
For more info on the EITC:
- MassBudget factsheet: Massachusetts's Earned Income Tax Credit
- MassBudget description of EITC on Children's Budget website
- Center on Budget and Policy Priorities paper: EITC and Child Tax Credit Promote Work, Reduce Poverty, and Support Children's Development, Research Finds
The Massachusetts Budget and Policy Center (MassBudget) produces policy research, analysis, and data-driven recommendations focused on improving the lives of low- and middle-income children and adults, strengthening our state's economy, and enhancing the quality of life in Massachusetts. |
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