Wal-Mart Joins Schumer On Tax Credit

WASHINGTON — Senator Schumer is partnering with an unlikely ally, Wal-Mart, to expand the enrollment by hourly employees in a key anti-poverty measure, the Earned Income Tax Credit.

Mr. Schumer announced legislation yesterday that would require large employers to notify workers that they may be eligible for the tax credit, which exceeds $1,900 for the average recipient. The effort, which is modeled on legislation recently enacted in California, comes as studies show that as many as 7.5 million low-income American families are eligible for the tax break but do not take advantage of it, forgoing a total of $14.5 billion annually. In New York alone, 500,000 eligible residents do not sign up for the tax credit.

Lawmakers blamed the problem on overly complex application forms and a general lack of awareness about the initiative, which began in the 1970s and has won praise from both Republicans and Democrats.

"The EITC is just a great program. It's very hard for people to partake in it," Mr. Schumer said at a news conference on Capitol Hill, where he was joined by the third-ranking Democrat in the House, Rep. Rahm Emanuel of Illinois, and representatives from Wal-Mart and a major health care labor group, the Service Employees International Union.

While Mr. Schumer's bill would mandate the eligibility notice, Wal-Mart announced that it would do so voluntarily beginning next year by informing its 1.4 million employees about the tax credit through its internal Web site, messages on pay stubs, and notices in store break rooms.

The retail giant has come under sharp criticism from many Democratically-aligned groups for its treatment of employees and its stance on unionization, and the New York City Council has virtually blocked the company from opening a store in the five boroughs. Yet it has taken steps to repair its public image, and this is the second time in recent months that it has partnered with a prominent New Yorker.

In April, Mayor Bloomberg secured an agreement from Wal-Mart to step up video surveillance and other measures to prevent illegal gun sales at its stores.

Mr. Schumer demurred yesterday when asked if Wal-Mart should be allowed to open a store in the city. "I think you'd have to look at the specifics," he said.

A vocal critic of Wal-Mart, the Union Food and Commercial Workers International Union, reacted with skepticism to the company's vow to expand its efforts to promote awareness of the EITC. "It's hard to know which Wal-Mart you are dealing with these days. One day they are lobbying in support of the huge Bush-McCain corporate tax cuts, and the next day they say they want to fix the EITC," a spokeswoman, Meghan Scott, said. "We hope that this is more about protecting the budgets of American workers than protecting Wal-Mart's bottom line."