[Congressional Record Volume 150, Number 66 (Wednesday, May 12, 2004)]
[House]
[Pages H2829-H2835]
From the Congressional Record Online through the Government Publishing Office [www.gpo.gov]




  PROVIDING FOR CONSIDERATION OF H.R. 4275, PERMANENT EXTENSION OF 10-
               PERCENT INDIVIDUAL INCOME TAX RATE BRACKET

  Mr. SESSIONS. Mr. Speaker, by direction of the Committee on Rules, I 
call up House Resolution 637 and ask for its immediate consideration.
  The Clerk read the resolution, as follows:

                              H. Res. 637

       Resolved, That upon the adoption of this resolution it 
     shall be in order to consider in the House the bill (H.R. 
     4275) to amend the Internal Revenue Code of 1986 to 
     permanently extend the 10-percent individual income tax rate 
     bracket. The bill shall be considered as read for amendment. 
     The previous question shall be considered as ordered on the 
     bill and on any amendment thereto to final passage without 
     intervening motion except: (1) one hour of debate on the bill 
     equally divided and controlled by the chairman and ranking 
     minority member of the Committee on Ways and Means; (2) the 
     amendment in the nature of a substitute printed in the report 
     of the Committee on Rules accompanying this resolution, if 
     offered by Representative Rangel of New York or his designee, 
     which shall be in order without intervention of any point of 
     order, shall be considered as read, and shall be separately 
     debatable for one hour equally divided and controlled by the 
     proponent and an opponent; and (3) one motion to recommit 
     with or without instructions.

  The SPEAKER pro tempore. The gentleman from Texas (Mr. Sessions) is 
recognized for 1 hour.
  Mr. SESSIONS. Mr. Speaker, for the purpose of debate only, I yield 
the customary 30 minutes to the gentleman from Texas (Mr. Frost), 
pending which I yield myself such time as I may consume. During 
consideration of this resolution, all time yielded is for the purposes 
of debate only.
  The resolution before us is a modified closed rule, the standard rule 
used for considering tax bills. It provides for 1 hour of debate in the 
House to be equally divided and controlled by the chairman and ranking 
minority member of the Committee on Ways and Means.
  It also provides for consideration of the amendment in the nature of 
a substitute printed in the Committee on Rules report accompanying the 
resolution, if offered by the gentleman from New York (Mr. Rangel) or 
his designee, which shall be considered as read and shall be separately 
debatable for 1 hour equally divided and controlled by the proponent 
and an opponent.
  Finally, the rule waives all points of order against the amendment 
printed in the report, and it provides one motion to recommit with or 
without instructions.
  Mr. Speaker, the legislation that we will be considering this week, 
H.R. 4275, the 10 percent tax bracket permanent extension bill, is very 
important to me, to my party, to the American taxpayers, and I believe 
this country. I support this legislation to fulfill a promise made by 
our great President, George W. Bush, and the Republican Party that was 
begun in 2001 when the 107th Congress overwhelmingly passed H.R. 1836, 
President Bush's visionary plan to provide American workers with 
comprehensive tax relief.
  Among other things, the President's bold 2001 tax plan created a new 
10 percent tax bracket, enabling millions of American families to keep 
more of their hard-earned money. In the period immediately preceding 
Congress' passing the President's tax proposal, between 1986 and 2000 
the lowest tax rate available to these American workers was 15 percent.
  The tax relief this new bracket provides to middle-class taxpayers 
has proven to be very beneficial to our economy and for hardworking 
families all across the United States. As a result, in 2003 Congress 
passed H.R. 2, another tax cut championed by President Bush that 
accelerated the phase-in of an expanded 10 percent tax bracket, 
increasing the amount of taxable family income that will be subject to 
this new lower rate. Under this bill the income eligible for this tax 
rate went up to $14,000 from $12,000, and up to $7,000 from $6,000 for 
singles.
  Unfortunately, because this tax cut language was written as a 
compromise with the Senate. If Congress fails to pass my bill and 
permanently extend the 10 percent tax bracket, in 2005, 2006, and 2007 
the bracket will shrink back to $12,000 and $6,000 for singles, 
increasing again briefly and then disappearing forever in 2011 to 
satisfy the arcane Senate budgetary rule.

[[Page H2830]]

  If this were allowed to happen, it would mean that some 22 million 
low-income filers whose tax liability is contained wholly within the 
tax bracket of 10 percent would immediately be shouldered with a 50 
percent income tax increase. I believe that this kind of tax increase 
on working-class Americans is simply unacceptable. My legislation 
offers a simple solution to prevent this major tax increase on middle-
class families from occurring. It maintains and adjusts for inflation 
the size of the 10 percent bracket at $14,000 for married couples, 
$7,000 for singles, and makes this bracket a permanent part of the Tax 
Code.
  If H.R. 4275 is not enacted, it would mean that 73 million tax 
returns, representing almost 150 million individual Americans, will be 
hit with a higher tax bill next year, and these taxpayers will face an 
average income tax increase of over $2,400 over the next decade. It 
would mean that those 22 million lower-income workers would be pushed 
into a higher tax bracket, including over 1.7 million hardworking 
Texans from my State who struggle every day to make ends meet. Congress 
should not and cannot allow this massive tax increase to occur, and my 
legislation would prevent this antigrowth scenario from happening.
  No other provision of the 2001 Bush tax cut has benefited taxpayers 
more broadly than the creation of this 10 percent bracket. Studies have 
shown that the benefits for this provision overwhelmingly flow to 
lower-and middle-income married earners between the ages of 25 and 54. 
These are precisely the people that this legislation will help, and I 
urge all of my colleagues to support this important tax measure on 
behalf of all American taxpayers.
  This week's vote on H.R. 4275 will provide the kind of broad-based 
middle-class tax relief to which the Republican Party is strongly 
committed and so am I.
  Mr. Speaker, I urge my colleagues to vote with me in supporting this 
rule and the underlying legislation.
  Mr. Speaker, I reserve the balance of my time.
  Mr. FROST. Mr. Speaker, I yield such time as he may consume to the 
gentleman from Georgia (Mr. Scott) for a brief personal privilege 
matter.
  (By unanimous consent, Mr. Scott of Georgia was allowed to speak out 
of order.)


                  Mourning the Passing of Gloria Aaron

  Mr. SCOTT of Georgia. Mr. Speaker, I thank the gentleman from Texas 
(Mr. Frost) for yielding to me, for being kind and generous for this 
moment.
  Mr. Speaker, I rise really with a heart of sorrow. I rise to ask to 
be excused from voting so that I may be able to attend a funeral for my 
wife's sister, my sister-in-law, Gloria Aaron in Mobile, Alabama, who 
passed on Mother's Day weekend, Saturday. The funeral will be tomorrow 
and the wake this evening.
  Of course, voting is paramount and most important to us here and I 
wanted to make sure it is a part of the Record as to why I will miss 
voting.
  And while I am here, Mr. Speaker, I would like to say just one word 
about Gloria Aaron. She was more than just a sister-in-law. She was a 
sister, very strong in her faith and belief in God, worked very hard in 
the church in Mobile at Morning Star Baptist Church. She leaves a 
mother, Estelle Aaron; one sister, my wife, Alfredia; two brothers, 
James and Hank Aaron. Our family are deeply in remorse. I thank the 
Speaker for giving me this opportunity. And of course for Gloria, she 
indeed fought that good fight. She kept the faith. She finished her 
course, and I am sure that there is a crown of righteousness in heaven 
for Gloria Aaron.
  I thank the gentleman from Texas for yielding, and I thank the 
Congress.
  Mr. FROST. Mr. Speaker, I yield myself such time as I may consume.
  (Mr. FROST asked and was given permission to revise and extend his 
remarks.)
  Mr. FROST. Mr. Speaker, I am pleased to join the gentleman from Texas 
(Mr. Sessions) today in support of H.R. 4275, legislation to make the 
expanded 10 percent tax bracket permanent. In my district in north 
Texas and across America, scores of families work hard every day to 
make ends meet. By passing this bill, we will provide some much-needed 
tax relief to these hardworking Americans.
  But I must admit, Mr. Speaker, I find it very odd that some Members 
of this House would champion the tax relief bill before us today when 
they have also at nearly every opportunity voted against other measures 
that would have provided significant economic benefits to a great many 
middle-class taxpayers. I am talking about measures like providing 
additional tax relief by reinstating the State sales tax deduction and 
ensuring overtime pay for America's police and firefighters.
  I think it is important to consider these sorts of measures now, Mr. 
Speaker, because many of our constituents are suffering from the recent 
recession and the outsourcing of good American jobs overseas.
  Do not get me wrong, Mr. Speaker, we all want to provide tax relief 
to our constituents. I voted last week in favor of the bill to provide 
relief from the Alternative Minimum Tax. I voted the week before to 
permanently eliminate the marriage tax penalty, and I will vote today 
to make the expanded tax bracket permanent. The bill on the floor today 
is a good bill and it is the very least we can do to help families in 
the country, but I think the American people deserve better than our 
least effort.
  Others may be happy to limit our efforts to help American families to 
this bill, but I am not, Mr. Speaker. We can improve this bill by 
amending the rule to allow for the consideration of H.R. 720, a bill 
introduced by the gentleman from Texas (Mr. Brady). His bill will 
reinstate the sales tax deduction so that citizens of States without 
income taxes may deduct their sales taxes from their Federal tax bill. 
This is a very important issue for many Americans, including my 
constituents in North Texas who do not pay a State income tax but have 
been plagued by high sales taxes which may rise even higher if some in 
the Texas legislature have their way.

                              {time}  1145

  Our State comptroller has estimated that the average Texas family 
would save about $300 a year on their Federal taxes under the bill 
offered by the gentleman from Texas (Mr. Brady).
  Last week, I attempted to bring a similar measure up for 
consideration, but that effort was defeated on a straight party-line 
vote.
  This is a bipartisan issue, Mr. Speaker, and I want to give the 
entire House an opportunity to vote on a bipartisan bill. H.R. 720 has 
78 cosponsors, 47 Republicans and 31 Democrats. I have cosponsored the 
bill, the gentleman from Texas who is managing today's rule on the 
other side of the aisle has cosponsored the bill, and dozens of other 
well-respected Members from both parties have cosponsored the bill. As 
a matter of fact, Mr. Speaker, the Republican leadership indicated last 
week that they too support this bill.
  So why do we not vote on it? Is this about politics, or is it about 
tax relief? Last week, Republicans defeated my amendment and said it 
was about politics. Well, here is a Republican bill that has strong 
bipartisan support and will provide millions of families with $300 a 
year in tax relief.
  The American people deserve to find out today whether the majority 
party will put partisan politics aside for just a minute to pass this 
badly needed tax relief. I bet our constituents just cannot wait to see 
how their elected Representatives will vote on this issue.
  In the coming weeks, I hope we will have more opportunities to help 
more families. But in the meantime, if Members are serious about 
helping their constituents, they will not only vote to extend the 10 
percent tax bracket permanently, they will also vote today to defeat 
the previous question and allow us to consider H.R. 720, to reinstate 
the sales tax deduction. It is a Republican bill with Democratic 
support. As my colleagues realize, a no vote will be a vote against tax 
cuts.
  Mr. Speaker, at this point I would like to insert several things in 
the Record. I am inserting a special report from Carole Keeton 
Rylander, the Texas Comptroller of Public Accounts. In this report she 
says, ``Restoration of the IRS sales tax deduction should be one of 
Texas' main priorities in Congress. The current discriminatory 
treatment of Texas taxpayers is taking $701 million out of Texas 
pockets and costing our State more than 16,000 jobs.''

[[Page H2831]]

  I would also at this point, Mr. Speaker, insert in the record a 
statement by my colleague, the gentleman from Texas (Mr. Brady), that 
he presented when he introduced this legislation. ``Washington should 
treat all States equally,'' Mr. Brady says. ``A broad bipartisan group 
pushes Congress to end bias against sales tax States.''

                      [Special Report, March 2002]

   Restoration of the IRS Sales Tax Deduction Should Be One of Texas' 
                      Main Priorities in Congress

                       (By Carole Keeton Rylander)

        Currently, the citizens of Texas and eight other states 
     are discriminated against because they cannot take any tax 
     deduction comparable to the state and local income tax 
     deductions enjoyed by the citizens of 41 other states and the 
     District of Columbia. In an attempt to alleviate this 
     disparity, Comptroller Rylander proposes to restore much of 
     the federal sales and motor vehicle sales tax deductions that 
     citizens of Texas were last able to itemize on their federal 
     income tax returns for the 1986 tax year.
        The Comptroller's plan would grant taxpayers in all states 
     the option of deducting either their state and local sales 
     and motor vehicle sales taxes or their state and local 
     individual income taxes on their Form 1040. While such an 
     option would not fully restore the original deduction, which 
     allowed deductions for sales as well as income taxes, it 
     would go a long way to restoring fundamental equity for 
     taxpayers in those states that no not impose income taxes on 
     their residents, and at minimal cost to the federal budget.
        There is already legislation before Congress that closely 
     tracks the Comptroller's plan. Last year, Representative 
     Brian Baird (D-Washington) introduced H.R. 322, and Sen. Fred 
     Thompson (R-Tennessee) introduced a similar bill, S. 291, in 
     the Senate. Both bills would grant taxpayers in all states 
     the option of itemizing a deduction for either their sales 
     (including motor vehicle sales) taxes or income taxes paid, 
     but not for both. Both bills would limit the deduction to a 
     specific amount prescribed in a table (individualized for 
     each state) providing deductible amounts by family size and 
     income group. Taxpayers, however, would not have the option 
     of deducting actual taxes paid, as they had in 1986 and 
     before. The main difference between the bills is that H.R. 
     322 refers to state sales taxes, while S. 291 refers to state 
     and local sales taxes. The Senate version also would allow 
     the deduction against the Alternative Minimum Tax. H.R. 322 
     boasts among its 58 co-sponsors 18 Texans; S. 291 is co-
     sponsored by both Texas senators.
        Texans lost their sales tax deductions in the last-minute 
     deal-making behind the Tax Reform Act of 1986. Before passage 
     of the Tax Reform Act of 1986 (TRA86), all individuals were 
     allowed to take separate income tax deductions for their 
     payments of state and local sales taxes and motor vehicle 
     sales taxes. For the sales tax, they were allowed to deduct 
     either the actual amount paid, or they could use an optional 
     sales tax table that provided deductible amounts for each 
     state (based on its rate and base) by income group and family 
     size. For example, a family of four with an income of $33,000 
     was allowed to deduct $306 in state sales taxes in Texas, but 
     $508 in Tennessee; and in both instances, taxpayers were 
     allowed to include an additional amount for local taxes paid.
        TRA86 was designed to simplify the federal income tax by 
     eliminating many deductions, exemptions and credits while 
     increasing personal exemptions and standard deductions and 
     lowering and compressing tax rates. The deduction of state 
     and local sales taxes was one of the last (and most 
     contentious) items considered by the Senate, but the final 
     efforts to restore at least some vestige of the deduction, 
     led in part by Sen. Phil Gramm, ultimately failed. The 
     argument put forth by members from the states that retained 
     their state and local income tax deduction was that the 
     losses attributable to the repeal of the sales tax 
     deduction would be more than made up for by the increased 
     personal exemption, and that the sales tax deduction only 
     benefited the rich, because lower-income groups are less 
     likely to itemize.
       The Comptroller's plan could be put in place for less than 
     1 percent of the costs of existing state and local tax 
     deductions. The March 26, 2001 cost estimate provided by the 
     Joint Committee on Taxation estimated that H.R. 322 would 
     decrease federal receipts by $23.1 billion over the 10-year 
     period 2002-2011. The annual costs were expected to average 
     $2.0 billion for the first three years, rising incrementally 
     thereafter. Putting the federal cost in perspective, the 1999 
     cost for the current deduction for state and local income and 
     property taxes was $268.9 billion. As such, reinstatement 
     would produce an increased cost to the federal government of 
     0.8 percent.
       The Comptroller's plan could be put in place with virtually 
     no increase in complexity. Although the sales tax deductions 
     were eliminated in part for reasons of tax simplification, 
     the proposed legislation before Congress would add only one 
     more line to Schedule A, for those taxpayers electing to 
     itemize on their Form 1040. Even if actual taxes paid were 
     allowed to be deducted there would be an addition of only two 
     lines: one for general sales taxes paid, and one for motor 
     vehicle sales taxes paid.
       Equity and fairness demand that tax discrimination against 
     Texans be eliminated. Reinstatement of the deduction for 
     sales taxes would eliminate the fundamental disparity created 
     by TRA86, when citizens in states with a personal income tax 
     were permitted to deduct such taxes, but citizens in states 
     without an income tax had no corresponding deduction. The net 
     effect of this disparity is that Texans, as well as the 
     citizens of the eight other states without a general 
     individual income tax pay a greater percentage of taxes to 
     the federal government than do citizens living in their 
     neighboring states with income taxes. In other words, the 
     federal tax law currently treats the same individual 
     differently solely on the basis of residence. Providing 
     individuals in all states the choice to deduct one or the 
     other of their sales or income taxes would restore equity and 
     fairness for all U.S. citizens at minimal cost.
       The Comptroller's plan would put more money in Texans' 
     pockets. As with everything else in the IRS Code, the devil 
     is in the details, and even subtle differences in proposed 
     legislation can have major revenue implications, making any 
     revenue estimates of the ultimate legislation difficult. 
     Assuming that the federal legislation fairly and accurately 
     portrayed Texans' sales tax and motor vehicle sales tax 
     payments, restoration of the sales tax deduction could be 
     expected to save Texans--in the aggregate--on the order of 
     $568.7 million (if only state sales taxes were exempted) to 
     $701.3 million (if state and local sales taxes were exempted) 
     in the 2002 Tax Year. The corresponding average savings per 
     itemizing Texas household would be $231 and $284.
       While the deduction only would go to taxpayers who itemized 
     their deductions, more Texans at lower income levels would 
     find it to their benefit to itemize. Right now, only one in 
     five tax returns filed by Texans itemizes deductions, 
     compared to almost one in three nationwide. The chief reason 
     for this is that citizens of 41 states and the District of 
     Columbia enjoy a deduction that is not available to Texans. 
     Restoration of the deduction for sales taxes paid would go a 
     long way towards bringing Texas closer to the national 
     average. In other words, the availability of the deduction 
     would benefit not only those who currently itemize, but an 
     additional number of slightly lower-income households that 
     would find it to their benefit to itemize.
       The Comptroller's plan would create more jobs, economic 
     growth, and state tax receipts with absolutely no state tax 
     or spending increase. Keeping as much as $701.3 million in 
     the hands of Texas taxpayers would provide a significant 
     boost to the state economy. Assuming that the legislation 
     passed this year and that the deduction could be taken on 
     income taxes filed in 2003 for the 2002 Tax Year, the tax 
     savings could be expected to generate 16,180 new Texas jobs, 
     $590 million in new Texas investment, and $874 million in 
     increased Texas Gross State Product in 2003. The increased 
     economic activity in turn could be expected to boost general 
     revenue by $66.5 million in the three-year period 2003-05. 
     Most of this revenue would come from increased sales and 
     motor vehicle sales tax collections.
       The Comptroller's plan promises a win-win situation for all 
     Texans, even those who do not itemize. To the extent that 
     keeping more Texas income in Texas, where it belongs, instead 
     of sending it off to Washington, all Texans would benefit 
     from the increased employment opportunities and investment. 
     In fact, it is difficult to find a downside for Texas to the 
     reinstatement of the sales tax deduction.
       The Comptroller's plan would be a straight-up win for the 
     state, a victory for tax equity among the states, and it 
     would provide a desirable, welcome boost to restoring 
     statewide economic and revenue growth.


                            salient features

       Legislation tracking the Comptroller's plan would cost the 
     federal government somewhere between $2.0 to $2.5 billion per 
     year--less than 1 percent of the $268.9 billion 1999 
     deduction for state and local income and property taxes.
       Texans would save as much as $701 million, or $284 per 
     itemizing household on their 2002 taxes.
       The estimated tax savings would be expected to generate 
     16,180 new Texas jobs, $590 million in new Texas investment, 
     and $874 million in increased Gross State Product in 2003.
       The increased economic activity could be expected to boost 
     2003-04 general revenue-related state tax receipts for the 
     three-year period 2003-05 by $66.5 million.
       Assuming that the federal legislation fairly and accurately 
     portrayed Texans' sales tax and motor vehicle sales tax 
     payments, a family of four with an income of $60,000 would be 
     able to deduct an additional $1,015 to calculate taxable 
     income, and a single mother of one with a total income of 
     $35,000 could deduct an additional $641.
       The current system discriminates against Texans and the 
     citizens of other states that have opted to finance their 
     budgets without personal income taxes. The Comptroller's plan 
     is necessary to restore fairness and equity in the treatment 
     of those state taxpayers who currently do not benefit from 
     the tax deductions enjoyed by the citizens of the other 41 
     states and the District of Columbia.

[[Page H2832]]

     
                                  ____
                          [February 12, 2003]

                ``Washington: Treat All States Equally''

               (Press Release by Congressman Kevin Brady)


 broad bipartisan group pushes congress to end bias against sales tax 
                                 states

       Washington, D.C.--U.S. Representative Kevin Brady (R-TX), a 
     member of the tax writing Ways and Means Committee in the 
     U.S. House of Representatives, introduced legislation, The 
     Sales Tax Equity Act, in Congress today that would treat 
     Texans the same way others in America are treated when it 
     comes to paying federal income tax.
       Brady's bill jointly introduced with a bipartisan group of 
     congressional legislators, restores the sales tax deduction 
     Congress repealed in 1986. Specifically, the act would allow 
     taxpayers to deduct either their state and local sales tax 
     from their federal tax return.
       ``When tax time comes around each April, taxpayers in Texas 
     and seven other states are discriminated against merely 
     because we live in a state that wisely chooses not to burden 
     families with a state income tax,'' notes Bardy. ``Taxpayers 
     in 42 states are allowed to deduct a portion of their state 
     income taxes. But states like ours that rely upon sales taxes 
     are discriminated against.''
       ``Americans should not be punished merely because of where 
     they live. States should be free to choose how to fund their 
     government without pressure from Washington. Uncle Sam's bias 
     toward the income tax is unfair and needs to end.''
       Texas Comptroller Carol Keeton Strayhorn estimates the 
     average Texas family would save just under $300 a year on 
     their federal taxes. Supported also by Governor Rick Perry, 
     The Sales Tax Equity Act would provide an economic boost by 
     creating over 16,000 new jobs, $590 million in new 
     investments, and $874 million in increased gross state 
     product in Texas.
       So that families don't need to keep a shoe box of sales 
     receipts, under Brady's bill the Internal Revenue Service 
     would establish average deduction tables based on filing 
     status, number of dependents, adjusted gross income and rates 
     of state, and local general sales taxes. The tables, which 
     taxpayers could opt for, are indexed for inflation.
       The bipartisan delegation announcing the legislation at a 
     news conference today in Washington include: Barbara Cubin 
     (R-Wyoming), Brian Baird (D-WA), Zach Wamp (R-TN), Mark Foley 
     (R-FL), Jim Cooper (D-TN) and Marsha Blackburn (R-TN). The 
     group is pushing to include the measure in President Bush's 
     Jobs & Growth tax relief package, noting that the measure 
     will help stimulate consumer spending, restores fairness and 
     helps low and middle-income taxpayers.
       ``Sales taxes add up for a family over the year,'' says 
     Brady. ``This is an issue of fairness and of reducing the 
     federal tax burden.''
       ``Another merit is this benefit taxpayers in every state 
     because it gives them the option of deducting whichever state 
     tax is higher, sales or income. That is a welcome tax relief 
     option'', says Brady.
       Other members of the Texas delegation supporting The Sales 
     Tax Equity Act include: Sam Johnson (R) Gene Green (D) 
     Michael Burgess (R); Eddie Bernice Johnson (D); John Carter 
     (R); Max Sandlin (D); Ron Paul (R); Ralph Hall (D); Martin 
     Frost (D); Henry Bonilla (R) and Silvestre Reyes (D).
       States without a state income tax include: Texas, Florida, 
     Tennessee, South Dakota, Nevada, Washington, Wyoming, and 
     Alaska. The bipartisan Joint Committee on Taxation estimates 
     the measure will provide $29 billion of tax relief over the 
     next decade.

  Mr. Speaker, it is clear that the legislation being offered today by 
the majority is good legislation, and I support the legislation. It is 
also clear that there is bipartisan support for the bill offered by the 
gentleman from Texas (Mr. Brady) to permit a deduction of State sales 
taxes in those States that do not have an income tax. It is a wrong 
that should be righted, and I hope this House will make in order a vote 
on the bill offered by the gentleman from Texas (Mr. Brady) at the same 
time we take up the bill offered by the gentleman from Texas (Mr. 
Sessions).
  Mr. Speaker, I reserve the balance of my time.
  Mr. SESSIONS. Mr. Speaker, I yield myself such time as I may consume.
  Mr. Speaker, I have great respect for what the gentleman was arguing 
here about this sales tax bill. It is something where the gentleman 
from Texas (Mr. Brady) has been joined with by the gentleman from 
Washington (Mr. Baird), as they have worked for a long, long time. I 
recall probably a full year ago where I was approached by both these 
gentleman about being a cosponsor of this important legislation.
  The fact of the matter is today we are here to consider this 10 
percent bill. Last week we considered other tax bills. Next week we 
will consider more tax bills. These are being done in such a way that 
would allow us a chance to talk about the importance of these, not only 
to taxpayers, but to the middle class of this country. It is my attempt 
and desire, just as it is with the gentleman from Washington (Mr. 
Baird) and the gentleman from Texas (Mr. Brady), to continue working 
with the chairman of the Committee on Ways and Means, the gentleman 
from California (Mr. Thomas), on the correct bill, the bill that he 
will support, the bill that will come to the floor, that bill that will 
pass, the bill that will provide this opportunity for all the taxpayers 
of these States. I believe it is some 17 States that currently have 
this problem as it relates to sales tax as a result of those States not 
having an income tax.
  Today we are here for H.R. 4275 because it does the right thing for 
middle-class wage earners on this 10 percent tax bracket, and I am 
proud of what we are doing. I think anytime we can join in talking 
about on the floor of the House a bipartisan approach to lowering 
taxes, increasing the opportunity for people to have more money, more 
take-home pay, more opportunity, it is always good.
  I have been an advocate of this for a long time. I do not think we 
should tax savings or investment in this country. That is not a part of 
what this is about today. We are talking about lowering the tax 
bracket, making it permanent, doing the right thing. I applaud those 
people that come to the floor and support this, because it is a great 
idea that we ought to make permanent.
  Mr. Speaker, I reserve the balance of my time.
  Mr. FROST. Mr. Speaker, I yield myself such time as I may consume.
  Mr. Speaker, it is interesting, my colleague from Texas talks about 
the legislation and, well, we will do that in all due time and all due 
course, in terms of the righting of the wrong that was committed 18 
years ago. The sales tax deduction for my State and for six other 
States, it is not 17, it is 7, was eliminated by this Congress in 1986, 
18 years ago.
  Only a few bills come out of the Committee on Ways and Means, only a 
few favored bills, so we have to take the opportunity to present this 
very important piece of legislation on the floor today and to give the 
House an opportunity to vote to right this wrong on the question of the 
deductibility of State sales tax. There are no other opportunities to 
present this to the House. That is why we are presenting it today. I 
hope that the House will give us the opportunity to right that wrong.
  Mr. Speaker, I yield 5 minutes to the gentleman from Washington (Mr. 
Baird).
  Mr. BAIRD. Mr. Speaker, I would like to thank my colleague from the 
great State of Texas for his leadership on this. The gentleman from 
Texas (Mr. Frost) has been a steadfast advocate of correcting this 
injustice for many years, and I appreciate working with him.
  Mr. Speaker, I also respect also my colleague on the other side of 
the aisle because I know he cares about this. But at the end of the day 
today, we will have had an opportunity to vote to at least restore 
fairness to our citizens.
  When we go back home, we cannot very well say to them ``it is a 
procedural matter,'' because it is also a procedural matter that every 
year when they fill out their taxes and they itemize their deductions, 
they have to put a zero; they have to say because our State chooses 
sales tax over income tax, as is their right, we are not able to deduct 
our sales taxes the way the States with income taxes can.
  It is a procedural matter that costs our taxpayers hundreds of 
dollars every single year that they could use for their families. It is 
a procedural matter that costs my State $500 million every year.
  The gentleman from Texas (Mr. Sessions) was right: We have passed a 
number of tax bills over the last few years in this Congress. We have 
had multiple opportunities, had the majority Members chosen to put 
their people over their partisanship. But they have declined.
  Here is another opportunity. There was one last week. How many weeks 
are we going to say to our constituents that you go to the back of the 
line again? We have lowered the tax rates on millionaires in this 
country. We have refused to fight for tax fairness by insisting that 
the people of our States be allowed their deductions. So millionaires, 
not just millionaires, but people earning $1 million a year in income, 
were put at the front of the line. Our States have been told again and 
again, you go to the back of the line.

[[Page H2833]]

  It is going to happen again today, I fear, and it does not have to. 
To my good friends on the other side of the aisle, we have worked and 
we should work in a bipartisan way, because the Tax Code does not say 
Republicans or Democrats or Independents get to deduct or do not get to 
deduct their sales tax. It just says all of you who have a sales tax do 
not get to deduct it.
  But at the end of the day, on a procedural vote, we are going to 
bypass yet another opportunity, and bypassing that opportunity over the 
last several years has cost our taxpayers thousands of dollars.
  When I ask my friends, when are you going to say to your leadership, 
we insist at long, long last that our constituents be treated fairly in 
the Tax Code? When are you going to say that? Because we have said it 
to our leadership.
  It is going to be in the Democratic bill. It has been in prior 
Democratic bills. We have brought it up before the Committee on Rules, 
with almost unanimous no votes on the other side, with few exceptions. 
We cannot get the help on the other side.
  My colleague, the gentleman from Texas (Mr. Frost), has been a 
steadfast advocate. He brought this issue up last week, and I am 
grateful he did. We didn't get a single yes vote from the other side. 
We did not get a single vote. Here it is again, and I wager we will not 
get a single vote yet again.
  At some point, the citizens of our States are going to catch on and 
they are going to say, for all this talk about tax cuts, why do you 
keep leaving us out? Because your leadership is putting you in a 
position that says, time and time and time and time again, you must 
vote with us and not with your constituents. And it is not your 
leadership who elected you, it is your constituents.
  The gentleman from Texas (Mr. Frost) has been responsive to his 
constituents. He has said we need to bring this up now, and we have the 
opportunity to do that now.
  I would just ask my colleagues, you know as well as I do the only way 
we get this to happen is to make this part of a larger bill. We do need 
to provide relief for low and mid-income families in the Tax Code, but 
we also need to provide relief for the families in our States who have 
suffered too long under this injustice.
  Mr. SESSIONS. Mr. Speaker, I yield myself such time as I may consume.
  Mr. Speaker, I thank the gentleman not only for his articulation of 
the wonderful merits of fairness in our Tax Code, fairness for all the 
people in all the States. I accept the opportunity for my colleague, 
the gentleman from Texas (Mr. Frost) to reiterate there are 7 States 
that this impacts, and I appreciate his bringing that to light and 
respect that.
  I would tell you that today, this is about the 10 percent bracket. 
This is a very specific request that we are making to the House of 
Representatives today that will be with the other requests that we are 
making on the parts of the Bush tax plan to make them permanent.
  It makes me proud to know that we in the House of Representatives are 
together on these issues, about their importance of people who are back 
home, people who are struggling, people who are trying to make ends 
meet, people who are trying to make sure they provide for their 
families and do those things which are necessary to their own dreams. 
It makes me happy, and I am very proud.
  Mr. FROST. Mr. Speaker, I yield myself such time as I may consume.
  Mr. Speaker, we have a good piece of legislation before us today that 
I intend to support. I think most Members of the House will support it. 
My only request is that, at the same time, we provide equity and 
justice to the residents of seven States who were denied that equity 
and justice in 1986.
  Now, I know my colleague is a relatively junior Member and was not 
here in 1986 when that legislation was voted on, but I was here, and I 
voted against the legislation that denied the residents of my State the 
opportunity to deduct their sales tax, when residents of New York and 
California and other States could deduct their State income tax.
  I feel very strongly about this issue, Mr. Speaker. As Members of 
this House, we can do so much to lend a helping hand to our 
constituents. Today we have a chance to do something good for millions 
of American families. We can pass the bill to make the extended 10 
percent tax bracket permanent, and then we can also immediately 
consider the Brady legislation, H.R. 720, to restore the sales tax 
deduction for citizens of Texas, Florida and other States lacking a 
State income tax.
  Now, as I mentioned earlier, last week I attempted to bring to the 
floor a similar bill to reinstate the sales tax deduction, but the 
Republican leadership indicated a preference for the Brady bill. So now 
we have a chance to consider the legislation that Republicans 
preferred. It does not matter to me which bill we consider. This is a 
bipartisan issue, with wide support on both sides of the aisle.

                              {time}  1200

  I just want to get it done.
  So today, Mr. Speaker, to get it done, I urge a ``no'' vote on the 
previous question. If the previous question is defeated, I will offer 
an amendment to the rule that will allow the House to vote on H.R. 720.
  Let me be clear, Mr. Speaker. Voting ``no'' on the previous question 
will not prevent this House from voting on the underlying bill. It will 
simply allow for the consideration of H.R. 720. A ``yes'' vote, 
however, will deny the House the chance to even consider the issue of 
reinstating the sales tax deduction.
  The American people deserve to know where their elected 
representatives stand on the issue of restoring the sales tax 
deduction. This is not a partisan issue, and this is not a political 
issue. This is about whether the citizens of Texas and other States 
should have to pay for the privilege of living there. I hope Members 
realize it today, and I hope their votes reflect this as well.
  I urge a ``no'' vote on the previous question and ask unanimous 
consent that the text of the amendment be printed in the Congressional 
Record immediately before the vote.
  The SPEAKER pro tempore (Mr. LaHood). Is there objection to the 
request of the gentleman from Texas?
  There was no objection.
  Mr. FROST. Mr. Speaker, I yield back the balance of my time.
  Mr. SESSIONS. Mr. Speaker, I yield myself such time as I may consume.
  We have graciously provided Members this wonderful opportunity to 
hear about the debate of H.R. 4275, providing each other, both parties, 
an opportunity for Members to hear about an agreement that we believe 
that this initiative that was begun by President Bush of this 10 
percent tax bracket, one that has now become available, one which we 
need to make permanent, is the question that is before us today on the 
floor. We have vetted this process. We have done those right things. We 
have gone through the committees. We have done this with numerous tax 
bills, and we will wish to continue doing that also.
  We have an abiding faith in the taxpayer, that special interest group 
of the Republican Party, the people who get up and go to work, people 
who make their lives work, people who care about their kids, people who 
create jobs and opportunity, people who do things because they love 
their country and they want America to be the strongest, with 
opportunity and bettering people's lives.
  That is part of what this H.R. 4275 is about. It is about bettering 
people's lives. It is a political consideration that our President, 
George W. Bush, floated to us years ago. It is about us as Members of 
Congress hearing that call, seeing people back home who relish this 
opportunity not to have it taken away. That is the importance of this 
body. This body is able to debate the issues, is able to bring them 
forth, is able to talk about them. And that is what is so evident about 
this great Nation, a majority rule.
  Mr. Speaker, I would say to my colleagues, I too wish we had lots of 
other things that would be a part of this bill for tax relief. Today is 
a day when we will stand up and say we are going to make sure that this 
10 percent bracket will be permanent for all taxpayers. I am proud of 
what we are doing. I ask each of my colleagues to support this rule, 
this underlying legislation, and the opportunity which I believe will 
be tomorrow to debate this fully on the

[[Page H2834]]

floor of the House of Representatives and, once again, give a victory 
to the taxpayers of this country.
  The material previously referred to by Mr. Frost is as follows:

 Previous Question for H. Res. 637; Rule on H.R. 4275--Making the 2003 
                Changes to the 10% Tax Bracket Permanent

       In the resolution strike ``and (3)'' and insert the 
     following:
       ``(3) the amendment printed in Sec. 2 of this resolution if 
     offered by Representative Brady of Texas or a designee, which 
     shall be in order without intervention of any point of order, 
     shall be considered as read, and shall separately debatable 
     for 60 minutes equally divided and controlled by the 
     proponent and an opponent; and (4)''
       Sec. 2. The amendment referred to in (3) follows:
       At the end of the bill add the following new section:

     SEC. 2. DEDUCTION OF STATE AND LOCAL GENERAL SALES TAXES IN 
                   LIEU OF STATE AND LOCAL INCOME TAXES.

       (a) In General.--Subsection (b) of section 164 of the 
     Internal Revenue Code of 1986 (relating to definitions and 
     special rules) is amended by adding at the end the following:
       ``(5) General sales taxes.--For purposes of subsection 
     (a)--
       ``(A) Election to deduct state and local sales taxes in 
     lieu of state and local income taxes.--
       ``(i) In general.--At the election of the taxpayer for the 
     taxable year, subsection (a) shall be applied--

       ``(I) without regard to the reference to State and local 
     income taxes,
       ``(II) as if State and local general sales taxes were 
     referred to in a paragraph thereof, and
       ``(III) without regard to the last sentence.

       ``(B) Definition of general sales tax.--The term `general 
     sales tax' means a tax imposed at one rate with respect to 
     the sale at retail of a broad range of classes of items.
       ``(C) Special rules for food, etc.--In the case of items of 
     food, clothing, medical supplies, and motor vehicles--
       ``(i) the fact that the tax does not apply with respect to 
     some or all of such items shall not be taken into account in 
     determining whether the tax applies with respect to a broad 
     range of classes of items, and
       ``(ii) the fact that the rate of tax applicable with 
     respect to some or all of such items is lower than the 
     general rate of tax shall not be taken into account in 
     determining whether the tax is imposed at one rate.
       ``(D) Items taxed at different rates.--Except in the case 
     of a lower rate of tax applicable with respect to an item 
     described in subparagraph (C), no deduction shall be allowed 
     under this paragraph for any general sales tax imposed with 
     respect to an item at a rate other than the general rate of 
     tax.
       ``(E) Compensating use taxes.--A compensating use tax with 
     respect to an item shall be treated as a general sales tax. 
     For purposes of the preceding sentence, the term 
     `compensating use tax' means, with respect to any item, a tax 
     which--
       ``(i) is imposed on the use, storage, or consumption of 
     such item, and
       ``(ii) is complementary to a general sales tax, but only if 
     a deduction is allowable under this paragraph with respect to 
     items sold at retail in the taxing jurisdiction which are 
     similar to such item.
       ``(F) Special rule for motor vehicles.--In the case of 
     motor vehicles, if the rate of tax exceeds the general rate, 
     such excess shall be disregarded and the general rate shall 
     be treated as the rate of tax.
       ``(G) Separately stated general sales taxes.--If the amount 
     of any general sales tax is separately stated, then, to the 
     extent that the amount so stated is paid by the consumer 
     (other than in connection with the consumer's trade or 
     business) to the seller, such amount shall be treated as a 
     tax imposed on, and paid by, such consumer.
       ``(H) Amount of deduction to be determined under tables.--
       ``(i) In general.--The amount of the deduction allowed 
     under this paragraph shall be determined under tables 
     prescribed by the Secretary.
       ``(ii) Requirements for tables.--The tables prescribed 
     under clause (i)--

       ``(I) shall reflect the provisions of this paragraph,
       ``(II) shall be based on the average consumption by 
     taxpayers on a State-by-State basis, as determined by the 
     Secretary, taking into account filing status, number of 
     dependents, adjusted gross income, and rates of State and 
     local general sales taxation, and
       ``(III) need only be determined with respect to adjusted 
     gross incomes up to the applicable amount (as determined 
     under section 68(b)).''.

       (b) Effective Date.--The amendments made by this section 
     shall apply to taxable years beginning after December 31, 
     2002.

  Mr. SESSIONS. Mr. Speaker, I yield back the balance of my time, and I 
move the previous question on the resolution.
  The SPEAKER pro tempore. The question is on ordering the previous 
question.
  The question was taken; and the Speaker pro tempore announced that 
the ``ayes'' appeared to have it.
  Mr. FROST. Mr. Speaker, I object to the vote on the ground that a 
quorum is not present and make the point of order that a quorum is not 
present.
  The SPEAKER pro tempore. Evidently a quorum is not present.
  The Sergeant at Arms will notify absent Members.
  Pursuant to clauses 8 and 9 of rule XX, this 15-minute vote on 
ordering the previous question on House Resolution 637 will be followed 
by 5-minute votes, if ordered, on adopting House Resolution 637, 
ordering the previous question on House Resolution 638, and adopting 
House Resolution 638.
  The vote was taken by electronic device, and there were--yeas 221, 
nays 203, not voting 9, as follows:

                             [Roll No. 156]

                               YEAS--221

     Aderholt
     Akin
     Bachus
     Baker
     Ballenger
     Barrett (SC)
     Bartlett (MD)
     Barton (TX)
     Bass
     Beauprez
     Bereuter
     Biggert
     Bilirakis
     Bishop (UT)
     Blackburn
     Blunt
     Boehlert
     Boehner
     Bonilla
     Bonner
     Bono
     Boozman
     Bradley (NH)
     Brady (TX)
     Brown (SC)
     Brown-Waite, Ginny
     Burgess
     Burns
     Burr
     Buyer
     Calvert
     Camp
     Cannon
     Cantor
     Capito
     Carter
     Castle
     Chabot
     Chocola
     Coble
     Cole
     Collins
     Cox
     Crane
     Crenshaw
     Cubin
     Culberson
     Cunningham
     Davis, Jo Ann
     Davis, Tom
     Deal (GA)
     DeLay
     Diaz-Balart, L.
     Diaz-Balart, M.
     Doolittle
     Dreier
     Dunn
     Ehlers
     Emerson
     English
     Everett
     Feeney
     Ferguson
     Flake
     Foley
     Forbes
     Fossella
     Franks (AZ)
     Frelinghuysen
     Garrett (NJ)
     Gerlach
     Gibbons
     Gilchrest
     Gillmor
     Gingrey
     Goode
     Goodlatte
     Goss
     Granger
     Graves
     Green (WI)
     Greenwood
     Gutknecht
     Hall
     Harris
     Hart
     Hastings (WA)
     Hayes
     Hayworth
     Hefley
     Hensarling
     Herger
     Hobson
     Hoekstra
     Hostettler
     Houghton
     Hulshof
     Hunter
     Hyde
     Isakson
     Issa
     Istook
     Johnson (CT)
     Johnson (IL)
     Johnson, Sam
     Jones (NC)
     Keller
     Kelly
     Kennedy (MN)
     King (IA)
     King (NY)
     Kingston
     Kirk
     Kline
     Knollenberg
     Kolbe
     LaHood
     Latham
     LaTourette
     Leach
     Lewis (CA)
     Lewis (KY)
     Linder
     LoBiondo
     Lucas (OK)
     Manzullo
     McCotter
     McCrery
     McHugh
     McInnis
     McKeon
     Mica
     Miller (FL)
     Miller (MI)
     Miller, Gary
     Moran (KS)
     Murphy
     Musgrave
     Myrick
     Nethercutt
     Neugebauer
     Ney
     Northup
     Norwood
     Nunes
     Nussle
     Osborne
     Ose
     Otter
     Oxley
     Paul
     Pearce
     Pence
     Peterson (PA)
     Petri
     Pickering
     Pitts
     Platts
     Pombo
     Porter
     Portman
     Pryce (OH)
     Putnam
     Quinn
     Radanovich
     Ramstad
     Regula
     Rehberg
     Renzi
     Reynolds
     Rogers (AL)
     Rogers (KY)
     Rogers (MI)
     Rohrabacher
     Ros-Lehtinen
     Royce
     Ryan (WI)
     Ryun (KS)
     Saxton
     Schrock
     Sensenbrenner
     Sessions
     Shadegg
     Shaw
     Shays
     Sherwood
     Shimkus
     Shuster
     Simmons
     Simpson
     Smith (MI)
     Smith (NJ)
     Smith (TX)
     Souder
     Stearns
     Sullivan
     Sweeney
     Tancredo
     Taylor (NC)
     Terry
     Thomas
     Thornberry
     Tiahrt
     Tiberi
     Toomey
     Turner (OH)
     Upton
     Vitter
     Walden (OR)
     Walsh
     Wamp
     Weldon (FL)
     Weldon (PA)
     Weller
     Whitfield
     Wicker
     Wilson (NM)
     Wilson (SC)
     Wolf
     Young (AK)
     Young (FL)

                               NAYS--203

     Abercrombie
     Ackerman
     Alexander
     Allen
     Andrews
     Baca
     Baird
     Baldwin
     Ballance
     Becerra
     Bell
     Berkley
     Berman
     Berry
     Bishop (GA)
     Bishop (NY)
     Blumenauer
     Boswell
     Boucher
     Boyd
     Brady (PA)
     Brown (OH)
     Brown, Corrine
     Capps
     Capuano
     Cardin
     Cardoza
     Carson (IN)
     Carson (OK)
     Case
     Chandler
     Clay
     Clyburn
     Conyers
     Cooper
     Costello
     Cramer
     Crowley
     Cummings
     Davis (AL)
     Davis (CA)
     Davis (IL)
     Davis (TN)
     DeGette
     Delahunt
     DeLauro
     Deutsch
     Dicks
     Dingell
     Doggett
     Dooley (CA)
     Doyle
     Duncan
     Edwards
     Emanuel
     Engel
     Eshoo
     Etheridge
     Evans
     Farr
     Fattah
     Filner
     Ford
     Frank (MA)
     Frost
     Gephardt
     Gonzalez
     Gordon
     Green (TX)
     Grijalva
     Gutierrez
     Harman
     Hastings (FL)
     Hill
     Hinchey
     Hinojosa
     Hoeffel
     Holden
     Holt
     Honda
     Hooley (OR)
     Hoyer
     Inslee
     Israel
     Jackson (IL)
     Jackson-Lee (TX)
     Jefferson
     Jenkins
     Johnson, E. B.
     Jones (OH)
     Kanjorski
     Kaptur
     Kennedy (RI)
     Kildee
     Kilpatrick
     Kind
     Kleczka
     Kucinich
     Lampson
     Langevin
     Lantos
     Larsen (WA)
     Larson (CT)
     Lee
     Levin
     Lewis (GA)
     Lipinski
     Lofgren
     Lowey
     Lucas (KY)
     Lynch
     Majette
     Maloney
     Markey
     Marshall
     Matheson
     Matsui
     McCarthy (MO)
     McCarthy (NY)
     McCollum
     McDermott
     McGovern
     McIntyre
     Meehan
     Meek (FL)
     Meeks (NY)
     Menendez
     Michaud
     Millender-McDonald
     Miller (NC)
     Miller, George
     Mollohan
     Moore
     Moran (VA)
     Murtha
     Nadler
     Napolitano
     Neal (MA)
     Oberstar
     Obey
     Olver
     Ortiz

[[Page H2835]]


     Owens
     Pallone
     Pascrell
     Pastor
     Payne
     Pelosi
     Peterson (MN)
     Pomeroy
     Price (NC)
     Rahall
     Rangel
     Rodriguez
     Ross
     Rothman
     Roybal-Allard
     Ruppersberger
     Rush
     Ryan (OH)
     Sabo
     Sanchez, Linda T.
     Sanchez, Loretta
     Sanders
     Sandlin
     Schakowsky
     Schiff
     Scott (GA)
     Scott (VA)
     Serrano
     Sherman
     Skelton
     Slaughter
     Smith (WA)
     Snyder
     Solis
     Spratt
     Stark
     Stenholm
     Strickland
     Stupak
     Tanner
     Tauscher
     Taylor (MS)
     Thompson (CA)
     Thompson (MS)
     Tierney
     Towns
     Turner (TX)
     Udall (CO)
     Udall (NM)
     Van Hollen
     Velazquez
     Visclosky
     Waters
     Watson
     Watt
     Waxman
     Weiner
     Wexler
     Woolsey
     Wu
     Wynn

                             NOT VOTING--9

     Burton (IN)
     Davis (FL)
     DeFazio
     DeMint
     Gallegly
     John
     McNulty
     Reyes
     Tauzin

                              {time}  1230

  Messrs. WYNN, JENKINS, DOGGETT and RUSH changed their vote from 
``yea'' to ``nay.''
  Mr. SOUDER changed his vote from ``nay'' to ``yea.''
  So the previous question was ordered.
  The result of the vote was announced as above recorded.
  The SPEAKER pro tempore (Mr. LaHood). The question is on the 
resolution.
  The resolution was agreed to.
  A motion to reconsider was laid on the table.

                          ____________________