A proposal to create a new refundable tax credit for lower-income working Pennsylvanians passed the state House of Representatives last Tuesday in a 185–15 vote, with strong bipartisan support.

House Bill 820, sponsored by Rep. Christina Sappey (D-Chester), would establish the Working Pennsylvanians Tax Credit — a state-level earned income tax credit (EITC) equal to 30 percent of the federal EITC. The credit would be refundable, meaning taxpayers would receive the full value even if it exceeds their state tax liability.

This bill is aimed at helping households that are working but still struggling to meet basic needs and could also encourage employment. According to the bill’s co-sponsorship memorandum, if the program had been in place last year, the average qualifying household would have received about $650.

The legislation is part of a broader conversation about how to support low- and moderate-income residents and will likely be part of negotiations ahead of the 2025–26 state budget. Supporters also point to potential long-term economic benefits, citing analysis suggesting the credit could stimulate growth and reduce demand for public assistance.

The bill now awaits consideration in the Senate.