Gov. Gavin Newsom said that the planned increase to the state’s minimum wage is moving forward while also reporting that more than $1 billion has gone back into the pockets of 3.6 million working Californians and their families through California’s Earned Income Tax Credit and Young Child Tax Credit.
Although current economic conditions due to the COVID-19 pandemic authorize him to suspend the scheduled increase in the minimum wage for 2021, Newsom declined to do so, announcing that he will move the increase forward as reflected in the 2020 state budget.
The minimum wage will increase on Jan. 1 to $13.00 per hour for businesses with 25 or fewer employees, and to $14 per hour for businesses with more than 25 employees.
“As we continue our efforts to slow the spread of COVID-19, we must also ensure that as our economy recovers, all Californians can benefit in its growth,” said Gov. Newsom. “Not allowing this increase to go forward will only make life harder for those Californians who have already borne a disproportionate share of the economic hardship caused by this pandemic. Many of them are on the front lines of the pandemic, providing child care, working in our hospitals and nursing facilities and making sure there’s food on grocery store shelves.”
The COVID-19 recession has not only dealt a swift and broad-based blow to California’s economy – it has taken a disproportionate toll on low-income Californians, worsening income disparities that predate the pandemic.
Newsom said the expansion of the California Earned Income Tax Credit, or CalEITC, and the creation of the Young Child Tax Credit, or YCTC, have provided much-needed financial relief to millions of Californians, especially families with young children.
As of Monday, more than 3.6 million filers claimed the CalEITC and YCTC, providing over $1 billion back to hardworking Californians, Newsom reported.
“The CalEITC is providing critical relief for millions of low-income Californians and their families, many of whom were struggling before the COVID-19 pandemic and have been hit especially hard during this time,” said Newsom. “The CalEITC and the new Young Child Tax Credit are helping families make ends meet.”
CalEITC-eligible families with children under the age of 6 can also receive up to $1,000 more by claiming the YCTC, established through the budget signed by Gov. Newsom last year.
Of the over $1 billion distributed through CalEITC and YCTC, $370 million was credited to 409,000 taxpayers who claimed the Young Child Tax Credit. This means money back in the pockets of almost half a million California families to help relieve their economic strain and address childhood poverty.
Last year, Gov. Newsom significantly expanded CalEITC, investing $1 billion to help Californians become more financially secure.
He expanded the program so Californians making up to $30,000 per year now qualify, and added a new Young Child Tax Credit for families with children under the age of 6.
“The CalEITC is an important investment in California’s families and our future,” said First Partner Jennifer Siebel Newsom. “I am grateful to the countless community organizations and volunteers who partnered with our administration to ensure this benefit reached those who need it most, particularly California’s kids.”
Governor says minimum wage increase will go forward; reports on tax credits
- Lake County News reports
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