[Congressional Record (Bound Edition), Volume 145 (1999), Part 5]
[House]
[Pages 6618-6624]
[From the U.S. Government Publishing Office, www.gpo.gov]




                   TAX DEDUCTION FAIRNESS ACT OF 1999

  The SPEAKER pro tempore. Under a previous order of the House, the 
gentleman from Washington (Mr. Baird) is recognized for 5 minutes.
  Mr. BAIRD. Mr. Speaker, I rise today to introduce legislation that 
will help restore tax fairness to millions of people in my home State 
of Washington and in other States throughout this great Nation. The 
problem, Mr. Speaker, is the lack of a deduction for sales taxes in the 
current tax code. Although the government allows tax deductions for a 
number of things, State and local income taxes, property taxes, self-
employment taxes and others, one category is noticeably missing and 
that is sales tax. Today and every year at this time, taxpayers send 
their tax returns to the IRS. It is a ritual that all Americans have 
become accustomed to. It is often frustrating. But we do it because we 
have to uphold our duties as a citizen. But that ritual brings added 
frustration for taxpayers in my State. A taxpayer in my State who has 
identical income and expenses to someone in another State should be 
able to deduct the amount they pay in State income tax, but that is not 
the case in Washington. We have no income tax, and we are not allowed 
to deduct our State sales taxes.
  Folks in my State have the same amount of Federal income taxes 
withheld from their paychecks, but when it comes time to itemize their 
returns, they can only deduct nothing, because they have no income tax 
and they are not allowed to deduct their sales tax. It is not that we 
pay less in taxes. On the contrary, we are in the top quarter of States 
in the amount of our personal income that goes to taxes. But thanks to 
the change in the tax code in 1986 when lawmakers decided to remove the 
deduction for sales taxes, people in Washington State were 
shortchanged.
  Let me ask this simple question. Should residents of Washington have 
to pay hundreds more to the Federal treasury than those who live in 
other States, including States right across the river? Does it make 
sense for the Federal Government to dictate to States how they should 
structure their tax system? I would assert that the answer is clearly 
no. Federal taxes should be levied on all of our Nation's citizens in a 
fair and equitable manner, not in a way that gives preference to some 
who happen to live in one State with an income tax while penalizing 
residents in States with sales taxes.
  That is why today I am introducing legislation to correct this 
inequity. My bill, the Tax Deduction Fairness Act of 1999, would 
reinstate the sales tax deduction and direct the IRS to develop tables 
of average sales tax liabilities for taxpayers in every State. It would 
then give the taxpayer an option, to deduct either the State income tax 
or their State sales taxes paid in the previous year.
  Frankly, this is nothing new. Before 1986, taxpayers were allowed to 
use simple tables to deduct their sales tax.
  Mr. Speaker, I enter into the Record a sample of the form that was 
used in 1986.

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  Critics might suggest this would make the tax code more complex. I am 
the last to want to make the tax code more complex and in fact I will 
work vigorously to simplify that code. But the bill I am introducing 
today does not complicate the tax code. It adds one very simple line to 
one simple form already filled out by a taxpayer itemizing his or her 
deductions. Adding that line will save our taxpayers hundreds of 
dollars every year. For clarity, I will submit that Schedule A for the 
Record as well.

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  If you look simply at line 5 of Schedule A, you see where people who 
pay income taxes to their State can deduct that, and you will see there 
is no line for Washington State taxpayers or taxpayers in similar 
States to deduct their sales tax.
  This is not a complicated bill. It is a very simple bill, it is a 
fair bill and I would urge my colleagues to support it. We have an 
obligation to treat citizens fairly at the Federal level. That is why I 
am here, to fight for simple fairness.
  This is the second time I have stood here in this well in less than a 
month to sponsor legislation that will protect our citizens from being 
subjected to unfair taxation. I will come back to the well of this 
House again and again until we achieve that standard.
  I hope that my colleagues will see the wisdom of this fair proposal 
and that we can take swift action to restore this common-sense option. 
I invite them to join me in this effort for the simple reason that it 
is the right thing to do.

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