04.30.12

Make state sales-tax deduction permanent

By:  Editorial Board
Source: The Seattle Times

SO long as U.S. taxpayers are allowed to deduct state income tax on IRS Form 1040, Schedule A, they ought to be allowed to deduct sales tax also. This is a matter of simple fairness for taxpayers in Washington and other high-sales-tax states.

The permanent deduction for state income tax has been in the federal code for decades. The option to write off sales tax has been in the code since 2004, and only as a temporary measure. Whenever it falls out, which it now has, legislators from the sales-tax states have to fight to put it back in.

In the Washington delegation the fight is led by U.S. Sen. Maria Cantwell, Democrat. She is pushing now to have temporary sales-tax deductibility restored in the bill to extend cuts in the Social Security tax. Every taxpayer in Washington who itemizes has a stake in her success.

A better solution is Senate Bill 24, Cantwell's legislation to make the deduction permanent. It is a bipartisan bill of huge interest to a handful of states. For taxpayers in Washington, the option to deduct sales tax is worth about $500 million a year. It is a very big deal for our state.