[Congressional Record (Bound Edition), Volume 153 (2007), Part 21]
[Senate]
[Pages 29070-29071]
[From the U.S. Government Publishing Office, www.gpo.gov]




                             TAX EXTENDERS

  Mr. CORNYN. Mr. President, I understand the chairman of the Finance 
Committee objected this morning to a unanimous consent request offered 
by Senator Inhofe regarding legislation that would ensure that American 
taxpayers would not pay higher taxes next year. The chairman of the 
Finance Committee indicated they are working on these provisions and he 
doesn't want them taken up now; he wants to bring them up later.
  It is important to talk about two taxpayer-friendly provisions in the 
IRS Code that will disappear in the next 60 days unless we do something 
about it. The first is a provision that gives taxpayers the option of 
deducting their State and local sales tax. My State of Texas, like a 
handful of other States, does not believe it needs a State income tax. 
We don't have one. We are not going to get one. What we do want is a 
level playing field when it comes to the Federal income tax code 
allowing the deduction of State and local sales tax, just as it allows 
currently a deduction of State income tax from one's Federal tax 
return.
  State and local governments have a number of options for raising 
revenue to pay for essential services they provide to their citizens. 
Some States raise revenues through an income tax. Some States, such as 
Texas, use a sales tax. Others use a combination of the two. In an 
effort to help protect people from overly burdensome taxation, the IRS 
Code has in the past allowed taxpayers to deduct all the State and 
local taxes they paid from their Federal taxes. Up until 1986, 
taxpayers could deduct State and local sales taxes. Unfortunately, this 
was unfairly eliminated. For 18 years, Texans and other States without 
a State income tax did not have the same level playing field other 
States had. I view this as a matter of gross discrimination against 
those States that have a State sales tax rather than a State income 
tax. It is simply unfair and needs to end on a permanent basis.
  That is why 3 years ago, I worked with several of my colleagues to 
reinstate the State and local sales tax deduction as part of the 
American Jobs Creation Act of 2004. Without quick Senate action, the 
citizens of Texas will once again be treated unfairly by the IRS Code 
by disallowing the deduction of State and local taxes. Our State and 
local governments have to have the flexibility to collect taxes that 
fund essential services in a way they find most appropriate without 
putting our citizens at a disadvantage. Again, make no mistake about 
it, Texans don't want a State income tax. We are a low-tax, pro-growth 
State. That is why we have seen 3 million people move to Texas since 
2000, because it provides incentives for job creation by small 
businesses and big businesses alike. We are not asking for the Federal 
Government to somehow bless Texas adopting a State income tax. We don't 
want it. What we do want is fundamental fairness.
  If the Senate allows this provision to expire, it will be punishing 
the citizens of my State based on geographic location and preference 
for a different tax system. Extending the sales tax deduction 
effectively gives Texans $1 billion in tax relief every year. This 
money not only helps hard-working middle- class families save money--
perhaps to invest in a small business or pay for college tuition for 
their children--it helps spur economic and job growth as well.
  Last week I introduced legislation, along with Senator Pat Roberts of

[[Page 29071]]

Kansas, that extends for 2 years the $4,000 above-the-line deduction 
for taxpayers who pay for college tuition. We frequently talk about the 
importance of education on the younger generation, from elementary 
school through college and beyond. We talk about the importance of 
continuing education, literally lifetime learning, in order for us to 
maintain and extend our global competitiveness. Aside from simply 
encouraging people to pursue a college education, we ought to do our 
best to make college more affordable and accessible and less of a 
burden on working parents who want to send their kids to college. 
Originally part of the Economic Growth and Tax Relief Reconciliation 
Act of 2001, this deduction allows taxpayers to deduct up to $4,000 
from their Federal income tax return regardless of whether they itemize 
deductions or not. This deduction goes a long way to help families 
struggling to put their children through college and benefits millions 
of taxpayers annually.
  According to the College Board, this deduction, along with grants and 
other education incentives, has helped lower the cost for the average 
student who goes to a public university by $3,600 and $9,300 for those 
who attend a private college. Both of these deductions keep money in 
the pockets of taxpayers. In my State of Texas, they allow them to pay 
for things such as health care, clothing and food, things they need and 
ought to be able to use their hard-earned money to pay for, rather than 
writing a bigger check to Uncle Sam. It is appropriate to use the IRS 
Code not only to provide for fundamental fairness when it comes to 
allowing the deduction of State and local sales tax from a Federal 
income tax return; it is also appropriate to use the IRS Code to 
provide for further educational opportunity.
  Right now taxpayers have to work a total of 120 days, about a third 
of the year, to pay their tax burden, whether it is Federal, State, or 
local taxes. The last thing we should do is force taxpayers to work 
more hours, longer days for Uncle Sam and not for their family. Rather 
than waiting for some future bill to hopefully address this need, the 
Senate should extend these taxpayer-friendly provisions today. I hope 
we will have another opportunity to come back to the floor, and I urge 
the Senate to extend these two important provisions in the near future.
  I yield the floor.

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