The state and local sales tax deduction on federal income tax returns ended on Jan. 1.
That's a travesty. Keeping the sales tax deduction for the people of Washington state is simply a matter of fairness. Those who live in Oregon and other states with an income tax can deduct a portion of their state payments from their federal income taxes.
Because just seven states have only a sales tax, a majority of the members of Congress aren't too concerned if the exemption is allowed.
But those in Congress do care about getting elected and making sure their political party holds the majority in the House, Senate or both. As a result, the sales tax exemption has been used for political purposes -- taken away and then reinstated and then taken away -- numerous times over the past two decades.
So here we are again. The deduction is gone and U.S. Sen. Maria Cantwell, D-Wash. (and up for re-election this fall) is taking the point in having it reinstated.
"It was in the tax code for decades," Cantwell said last week. "And yet every year we have to play this game about whether or not we are going to have the equity that other states have."
This exemption saves a typical family in Washington state about $600 a year in taxes. According to the latest IRS data, which is from 2009, nearly 850,000 Washingtonians took advantage of the deduction and reduced their taxable income by over $1.8 billion, according to a news release. This kept $500 million in Washington state rather than going to Washington, D.C.
The last time this was an issue was in 2010 when Sen. Patty Murray, D-Wash., was challenged by Republican Dino Rossi. Republicans and Democrats initially blocked efforts to extend the tax, which left the issue in play for the Senate race. Ultimately, common sense trumped politics and the tax was extended through 2011.
In 2010 then-Rep. Brian Baird, D-Vancouver, who was not seeking re-election, was concerned politics will ultimately hurt Washingtonians.
"Sometimes brinkmanship can take you over the brink," Baird said in an interview with Tacoma News Tribune newspaper. He said he would find it "reprehensible" if either side was holding the measure hostage to advance their candidates at the expense of middle-class taxpayers.
That view holds true today. Congress needs to return the sales-tax deduction. This is a ridiculous political game that could cost families in Washington state $500 million a year.