WASHINGTON, DC –  As Washingtonians start working on their 2007 tax returns,  U.S. Senator Maria Cantwell (D-WA) reminded Washington state taxpayers to  take advantage of the state sales tax deduction if they itemize their federal tax returns. 

“With tax season upon us, Washingtonians should remember to deduct state sales tax from their federal returns if they itemize,” said Cantwell, a member of the Senate Finance Committee. “In 2005, nearly one million Washington families and individuals claimed nearly $2 billion in deductions and got almost $600 million right back in their pockets. This money can go towards many things, but most it can most certainly contribute to a shaky economy.   Not only is this about boosting Washington taxpayers' refunds, it's about tax fairness.  This deduction must be extended for 2008 and I will continue to work to make it permanent.”  

 

Cantwell’s office created a report that shows how the state sales tax deduction stimulates Washington’s economic growth.  An estimated 2,000 to 3,000 jobs are created in the state by the deduction and, in 2008, the direct impact of the deduction on the state’s economy will be $570 million. The state sales tax deduction increases economic growth by drawing in new businesses, creating new jobs, and keeping more money in the state. 

 

In 2004, Cantwell and Congressman Brian Baird (WA-03) worked with a bipartisan coalition to pass a two-year deduction and repeated their victory in 2006. The current extension is effective for 2006 and 2007 returns only. Unless Congress acts again, it will expire with the 2007 filing. Unlike the sales tax deduction, the deduction for state and local income taxes does not sunset.  The lawmakers have fought continuously since 2004 to make the deduction permanent. As her first action as a new member of the Senate Finance Committee in January, Cantwell introduced stand-alone legislation to make the state sales tax deduction a permanent feature of the U.S. tax code.

 

 

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