One of the reasons Puerto Rico wants statehood is because of:
programs like Medicaid and the Earned Income Tax Credit, which aren’t available to those living in the U.S. territory
For those who aren’t familiar with it, the Earned Income Tax Credit is a tax credit for low income people. It is a “refundable” tax credit meaning that any excess over what you paid in taxes is refundable to you.
In English, that means that low income people can get more money “back” in taxes than they paid. Basically, they’re getting “free” money from the government.
Now…this post is not to argue the merits of that program, but only to point out what the Governor of Puerto Rico is whining about…the fact that, as a territory rather than a state, they don’t get free money from the rest of us.
According to the US census bureau, as of 2019, the median family income in Puerto Rico is $20,539. What’s the cutoff for receiving the Earned Income Tax Credit? $21,710 for a couple with no children. With 2 children, it’s $53,330.
So, basically, something like 60% of the population of Puerto Rico will qualify for free money from the rest of us.
“But it’s unfair that they don’t qualify for it, if other US citizens can get it”. I’d agree except for one minor detail. As a territory, Puerto Rican citizens don’t pay federal income taxes at all…that’s why they don’t qualify for the EITC. Funny the Governor didn’t mention that.
I’d be willing to bet that most of the 47% of the Puerto Rican population that voted against statehood are the ones who make enough money they’d actually have to start paying taxes. the 53% who voted for statehood are undoubtedly the people hoping for some of that free money.