Last week the Common Sense Foundation took part in a press conference calling for help for North Carolina’s working families.

With big-money lobbyists working the halls of the General Assembly, it’s usually the wealthiest people who get breaks from government. More and more people are starting to protest that spoils system, however.

The passage of the state minimum-wage increase this year was a bellwether that showed that things are indeed beginning to change in Raleigh. So last week’s press conference emphasized the creation of a state Earned Income Tax Credit to continue extending a hand up to working families.

A refundable state EITC, set at 20% of the federal EITC, would give immediate assistance to North Carolina’s thousands of working-poor families. Virginia just passed a 20% state EITC this year, so we wouldn’t be the only Southern state among the 18 states that have one. Making it refundable means making it fair by giving the same amount of credit to everyone who qualifies below a certain level of income.

You’d think that the far right would love the EITC because they love tax cuts as a rule, but we hear too many extremists talking about “EITC fraud.” Yet there is no evidence of any kind of widespread EITC fraud. A recent U.S. Treasury study found that 88% of the cases cited by conservatives as “fraud” are in fact instances either of taxpayers failing to claim what is due them or taxpayers filing incorrectly due to confusion over filing status. That’s hardly a boondoggle.

In a state that derives much of its revenue from the sales tax and other regressive taxes, it makes a lot of sense to relieve some of the burden borne by the working poor. The cost of a 20% EITC would be around $223 million, which could easily be paid for if the state were to address several glaring corporate loopholes (such as the bank tax loophole) and keep the more progressive top rate on its income-tax scale.

Child-care subsidies and improved access to health care should be part of the discussion too. Along with a 20% refundable EITC these policy changes are part of an important agenda for working families that should be the focus of the legislature’s work in 2007.