Assessing the Economic Impacts of the Earned Income Tax Credit on Five Economically Depressed Counties in Southwest Washington State

Abstract

An economic impact analysis of the earned income tax credit for tax year 2013 using the IMPLAN input output model demonstrates that $36,200,241 dollars in EITC expenditures from recipients creates 267 jobs, $9,360,085 dollars in labor income and $25,793,443 in total economic output in five southwest Washington counties. Other findings demonstrate that a public outreach campaign to focus EITC expenditures on the local economy could significantly increase the economic impact of the EITC. Also refunding the Washington State EITC will eliminate 10% of the tax levied on EITC benefits.