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1 Kyle Pomerleau & Huaqun Li, Analysis of the Cost-of-Living Refund Act of 2019 1 (2019)

handle is hein.taxfoundation/anycsref0001 and id is 1 raw text is: u9mo7 Analysis of the Cost-of-Living Refund Act of 2019 FISCAL FACT Kyle Pomerleau Huaqun Li Chief Economist and Economist No. 640 Vice President of Economic Analysis Mar. 2019 Key Findings * Senator Sherrod Brown (D-OH), Representative Bonnie Watson Coleman (D- NJ), and Representative Ro Khanna (D-CA) introduced legislation to expand the Earned Income Tax Credit called the Cost-of-Living Refund Act of 2019. This legislation was recently reintroduced. * The Cost-of-Living Refund Act of 2019 would reduce federal revenue by $1.8 trillion between 2020 and 2029 on a conventional basis. * The Cost-of-Living Refund Act of 2019 would slightly reduce the overall incentive to work, leading to 51,577 fewer full-time equivalent jobs and a 0.29 percent smaller economy in the long run. * The effect the Cost-of-Living Refund Act of 2019 has on the incentive to work would depend on how much income a tax filer earns. The proposal would increase the incentive for low-income tax filers to work, leading to 822,788 more full-time equivalent jobs for that income group. * The smaller projected economy over the next decade would result in slightly lower revenue collections. As a result, we estimate that this proposal would reduce federal revenue by $1.9 trillion between 2020 and 2029 on a dynamic basis. TheTa Fondaion s te nt ions eadng independent ta Tholfudicytl c Cost-of-Living SeAct of 209 would increase the our research, anayss, and xet he progressivity of the tax code by raising the after-tax incomes of the bottom at the federal state, and local Q2019 Tax Fondaion Dirbued uner a idl ,fit20 percent of taxpayers by 15.4 percent. Overall, taxpayer after-tax income would rise by 1.5 percent. Creatie Commons CC-BY-NC 4.0 Editr, Rache Sh ter Degner, an jal Tax Foundation 1325 G Street, NW, Suite 950 Washington, DC 20005 202.464.6200 taxfoundation.org