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Refundable tax credit refers to the concept of giving tax refunds to individuals in excess of the amount of tax actually paid. By making a tax credit refundable, a government uses the tax system to redistribute wealth.
This redistribution from the affluent to the more needy, is a form of welfare, a forced material egalitarianism.
It is a more moderate form of a negative income tax.
In the United States, the main example of this type of credit is the Earned Income Tax Credit.
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