American’s Earned Income Tax Credit And Its Suggestions To Urban Anti-Poverty Strategy In China

American Earned Income Tax Credit (EITC) has become the largest cash assistance program of American federal government for low-income families. This program has improved their living standard and motivated their employment enthusiasm. EITC has reduced the poverty rate in American, especially alleviated poverty in female single-parent and children families. It has been obtain supports from Democratic and Republican, as well as generally recognized in public. In addition, UK, Canada, South Korea and Taiwan in China want to establish their EITC which are in accordance under their domestic conditions. In China, since The 18th National Congress of the Communist Party, the Communist Party and government attached great importance to adjust income redistribution and promote social equality and justice. At the same time, due to the rapid development of urbanization and urban population, the object and level of poverty in urban changed correspondingly. So the concept and strategy of urban anti-poverty should be make the appropriately adjustments. EITC program has balanced between efficiency and equity, by means of wage subsidies to alleviate poverty for low-income workers, Therefore, it is of importance to study this program and know the program how to regulate income redistribution, promote fairness and alleviate the present and future of China’s urban poverty.Established on the basis of the existing related research, this paper firstly reviews the theoretical and practical background of EITC, introduces its evolution progress. Secondly, analysis the target groups, eligibility criteria, operational mechanism, management mechanisms, as well as sources of funding and the relationship to other welfare programs. Thirdly, this paper evaluates the running results from identify the target object, realize the goal of the booking, management, public satisfaction, analysis key and difficult points. Through analysis, combined with the present situation and problems of urban poverty in China, this paper makes suggestions to urban anti-poverty from policy principle, the participation subject,target groups, the unit of anti-poverty, focus and auxiliary means. Finally, this paper draw a conclusion that EITC is a balance fairness and efficiency anti-poverty program, this program greatly released poverty, especially children poverty, considered family responsibilities in order to keep family stability; used tax system to save management costs as well as EITC program make suggestions to Urban anti-poverty strategy in China.