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Originally published Friday, December 5, 2014 at 4:03 PM

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Editorial: Congress should make sales-tax deduction permanent

Congress should stop its now annual ritual of extending the sales-tax deduction and make the policy permanent.


Seattle Times Editorial

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MORE than a quarter of Washington taxpayers are in jeopardy of paying about $600 more in federal taxes than they should. Congress should extend a tax provision important to the eight states that collect sales tax.

Better idea: Make it permanent, once and for all.

The U.S. House Wednesday passed a one-year extension for the sales-tax deduction and several other tax deductions that total about $45 billion. The bill is expected to move to the U.S. Senate within the next week, according to news reports.

The sales-tax deduction is particularly important to taxpayers who itemize their tax returns and live in states that don’t have an income tax, such as Washington.

Taxpayers in states with an income tax can deduct their state income taxes on their federal returns, so the sales-tax deduction makes the tax code more fair.

For example, in 2012 about 28 percent of Washington taxpayers used the deduction for an average savings of $602, according to the Pew Charitable Trusts.

A one-year extension is better than nothing, but it’s time to take long-term action. Congress has turned extending the sales-tax deduction into a holiday tradition since it expired in 2004. Not all end-of-year traditions are worth the effort.

Each year, lawmakers go through the same routine leaving Washington residents uncertain if the tax break will be back next year. U.S. Sen. Maria Cantwell, D-Wash., has proposed bills each of the past four years to make it permanent, but not one has passed Congress.

Despite bipartisan support for the sales-tax deduction, Congress has been reluctant to extend it for a longer term.

Among the reasons is that the tax system is in need of an overhaul, so lawmakers don’t want to make permanent changes piece by piece. Instead, they opt for voting year after year on the same extension.

The sales-tax deduction, which is about fairness for taxpayers living in states with a sales tax, ends up bundled with other unrelated tax breaks, such as deductions for NASCAR and racehorse owners.

Waiting on a major overhaul is a poor excuse for not making the sales-tax deduction permanent. Congress should stop the quick fixes and give Washington taxpayers certainty for years to come.

Editorial board members are editorial page editor Kate Riley, Frank A. Blethen, Ryan Blethen, Jonathan Martin, Thanh Tan, Blanca Torres, Robert J. Vickers, William K. Blethen (emeritus) and Robert C. Blethen (emeritus).



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