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Shirley Leung

Politics get in the way of aid to poor

From left: Charlie Baker, Stanley Rosenberg, and Bob DeLeo (shown here in November) all express support for the earned income tax credit but differ on how to fund any expansion of the benefits. Elise Amendola/Associated Press/File 2014

They say they want to help working families, but will they?

I’m talking about the Big Three: Governor Charlie Baker, House Speaker Bob DeLeo, and Senate President Stan Rosenberg. All of them want to cut tax bills for low-income families, but as the Legislature’s budget deadline looms, they can’t agree on how to pay for it.

People of Massachusetts, please don’t stand for this. There’s no gold star for trying. If this is something the Big Three want, then they should make it happen.

But a lot of politics is getting in the way of helping more than 400,000 Massachusetts households who struggle to make ends meet. There’s no debate on the power of the earned income tax credit, which is available to working families who make less than about $50,000 a year. From liberal to conservative, from advocates of the poor to Warren Buffett, this tax credit — both the federal and state versions — has been hailed as one of the most effective antipoverty policies out there.

How to foot the bill is where the Big Three stop being on the same page.

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Baker wants to double the earned income tax credit by phasing out the controversial state tax break to movie studios. Rosenberg, who championed the legislation that created the state’s tax break for the working poor in 1997, wants to pay for the program’s expansion by freezing the income tax rate.

Baker doesn’t like the Senate plan because he considers it a tax hike, something that would anger his Republican base. Meanwhile, DeLeo is giving the thumbs down — and that’s putting it politely — to both plans.

Not only is the House staunchly standing by tax breaks to Hollywood, but it vigorously fought the Senate’s plan, even asking the Supreme Judicial Court to weigh in. The high court sided with the Senate last week, saying its plan did not violate the House’s sole power to originate so-called money bills.

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Don’t count on DeLeo being in a compromising mood. He also doesn’t like the Senate plan because it mimics a tax increase by preventing next year’s scheduled reduction in the state income tax rate to 5.10 percent from 5.15 percent.

It wasn’t that long ago when the Big Three, smiles and all, were singing kumbaya when Baker took office in January. Now look at them, tussling over an MBTA overhaul plan and the earned income tax credit.

But it’s not like they don’t talk
to each other. In fact, the Big Three meet every Monday for an hour or so at the State House to hash out issues.

When I caught up with them after this week’s meeting, Baker acknowledged that the earned income tax credit wasn’t on the agenda this time, but he reiterated it’s still a priority for his administration.

The governor gave props to the Senate for putting out a proposal to increase the tax credit, though he still likes his funding model better.

But Baker made clear he’s willing to strike a deal.

“I’ve said from the very beginning of this whole process that budgets are a combo platter,” he said, flanked by DeLeo and Rosenberg. “We’ll see what happens coming out at the other end.”

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Rosenberg, who talked about increasing the earned income tax credit in his inaugural address in January, also seemed eager for some give and take.

“I’m glad that he put the subject on the table through the campaign,” said the Senate president, “and I’m glad we’re continuing the conversation through the budget process and beyond.”

Which leaves us with DeLeo.

There’s no proposal from the House, just pooh-poohing of other people’s plans. In other words, doing nothing about giving more tax breaks to the working poor. Is he with the program or not?

“I am in favor of the earned income tax credit,” insisted DeLeo.

Now, neither the governor’s nor the Senate’s plan is perfect. Baker’s idea of phasing out the film tax break doesn’t fully pay for doubling the earned income tax credit. The Senate plan calls for a 50 percent increase in the tax credit, and while it would be fully funded by freezing the income tax rate, it represents a tax increase for the wealthy.

Both Baker and DeLeo have a problem with raising taxes, and so the Senate idea seems like a nonstarter.

As for the film tax credit — universally vilified for the costs outweighing the benefits — the Senate is looking at reforming the program rather than getting rid of it. Could the House get behind a scaled-down film tax program?

Clearly, the Big Three have a lot to work through before they can step up tax breaks for the working poor. Unlike fixing the T, they won’t have powerful unions and business groups trying to get their way.

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Those at the bottom don’t have advocates like those at the top. Only the Big Three can make working families a priority.

We’ll find out soon just how committed they are.

RELATED COVERAGE:

State’s highest court sides with Senate in tax fight

House, Senate argue over tax tif

Horowitz: Senate, Baker at odds over how to help low-income workers

Four stories of escaping poverty in Boston

Lawmakers ask SJC to settle dispute about taxes

Senate votes to increase state’s earned income tax credit


Shirley Leung is a Globe columnist. She can be reached at shirley.leung@globe.com. Follow her on Twitter @leung.