Spokane7
67°
February 9, 2011 in Opinion
Editorial: Permanent sales tax deduction fair solution
As always, the deductibility of sales tax in the seven states that don’t have an income tax came down to the wire, with Congress issuing a temporary reprieve in December. Congress should make this a permanent change in the tax code, but then members of the other 43 states would lose the ability to take the issue hostage.
The ransom note changes from year to year, but what never occurs is a debate on the merits of making this deduction permanent. Instead, members of Congress recapture the issue as the expiration date nears and new demands are announced.
In the past, this issue has been tethered to debates over the minimum wage and taxes on dividends, capital gains and estates. In December, it was tied to the extension of the Bush-era tax cuts.
It’s always something.
The deductibility of sales taxes returned in 2004, after an 18-year absence. Residents of states with income taxes have the burden lowered because that levy is deductible on federal forms. The rest, including Washingtonians, must wait until the last minute to see whether they can get a similar break.
Some years the haggling goes on so long that the Internal Revenue Service cannot gear up in time. This year is no exception. Washington state residents who itemize their deductions have been told to wait until Feb. 14 (Happy Valentine’s Day!) before working on their tax returns, because it took so long for Congress to agree on the extension for 2010 and 2011.
That means many people will have to wait two to three weeks longer for their refund checks.
U.S. Sen. Maria Cantwell, D-Wash., has introduced a bill that would make the sales-tax deduction a permanent feature of the tax code. She notes that nearly 860,000 Washingtonians took the deduction in 2008, the latest year figures were available. That means about $500 extra for the average itemizer. It’s the kind of economic boost the other 43 states receive without having to continually fight for it.
She, of course, will get the support of the Washington delegation and those in the other affected states: Alaska, Florida, Nevada, South Dakota, Texas and Wyoming. But what she hopes to avert, at long last, is having the issue snatched away and blindfolded before it gets a stand-alone vote.
It’s simple justice. Simple fairness.
To respond to this editorial online, go to www.spokesman.com and click on Opinion under the Topics menu.
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Alfredo on February 09 at 3:01 a.m.
OMG We’re soooo overtaxed :’(
I mean…good lord. No state income tax and you’re complaining because of deductions for it?
Guess what? Most states that have an income tax ALSO have a state sales tax which believe it or not is not all that far behind WA state.
If you don’t want to wait until Feb. 14, file now and quite weaseling every cent of your taxes.
I see no problem paying our sales taxes here, why do you? Would you prefer an income tax AND sales tax?
The average was a $500 discount for those who itemize? Seriously? Why am I thinking these are the folks who should be creating jobs instead of worrying about $500 in sales taxes. Why do they hate our country and our state so bad that they will do anything they can to skirt their responsibility? I file 1040 and I do not really get into the itemizing, why should I bear your burden!?!? Get a job, pay your darn taxes you self-centered anti-taxist! I work, and I’ve lived in states with sales tax AND income tax and gladly paid it without having to hear about some whining sniveling baby crying over “omg I’m so taxed to death, I don’t think I can take it anymore” followed with tears.
Where are the JOBS? I thought you thugs were all about the jobs…but we know that’s not the case now is it?
New_Improved_Drywitt2000 on February 09 at 4:29 a.m.
THUGS
I like that.
Much more politically correct than
TEABAGGER.
But not as much fun!!
hawken on February 09 at 6:38 a.m.
The radical left commune, “tax more and spend more”, just cannot help themselves. Name calling is part of their DNA when anyone agrees with them, even there own.
News alert #1! The Dems control the Presidency and the Senate.
News alert #2! The president promised unemployment would drop below 8% last summer if only, only, we would accept his massive $800 BILLION stimulus bill. That idea was an abysmal failure! The only thing it accomplished was more debt which we cannot pay.
Now, the Obama administration is talking about more bailouts! This time the states. More failed stimulus. More debt.
The stimulus did little more than “stimulate” the growth of government. Now more of the same? Bailing out the states? More tax and spend madness!
So, where are the jobs Mr. President?
Of course, I would never refer to you as a “thug,” Mr. President, as has been done above. I prefer more accurate, civil terms such as “hyper-left liberal.”
WillyPeter on February 09 at 8:47 a.m.
@Alfredo, your post brought tears to my eyes. Maybe moving back to one of those states that have income and sales taxes would make you happy, ‘cause it ain’t gonna happen here. And…. It would certainly make most of us real Washingtonians happy. win-win
DickAdams on February 09 at 10:08 a.m.
Reckless spending habits must be stopped. I`m a dreamer but I think its possible if the voters do their homework and vote accordingly. Too many spend thrifts are elected. Throw these bums out.
Alfredo on February 09 at 10:14 a.m.
WillyPeter, sure, I will leave. You’re a few fries short of a happy meal.
You would like those who gladly pay their taxes to leave, then who will subsidize you?
SpokyDaBear on February 09 at 12:13 p.m.
Next we will be hearing from Alfredo the IRS should take away the mortgage interest deduction.
Alfredo, obviously you are a closet socialist. It’s okay, Alredo, come out of the closet.
Either that or move to Sweden and hook up with your socialist buddies and enjoy your Swedish government overtaxing you from cradle to grave.
Alfredo on February 09 at 2:37 p.m.
Keep up the socialist garbage….I’d rather be a socialist than a fascist which is what most of you are, even though you don’t even realize that your opinions are formed through mass media blitzes from those who prey upon your fears and hatred.
hawken on February 09 at 4:50 p.m.
Conservatives don’t mind at all being called Conservative.
Why is it, I ponder, that most liberals and all socialists don’t like being called liberal or socialist.
Is that the reason liberals are trying to “re-brand” their image, by renaming themselves as “progressives?”
ie; Hillary Clinton, when she says that she is proudly an early 20th century “Progressive.” For all of you who do not understand what it means to be an “early, 20th Century Progressive”,,,, I highly recommend that you spend an hour or so on the Internet researching what that means. Beginning with Woodrow Wilson.
Once you do this, we will readily welcome you to the conservative camp. Ronald Reagan, formerly a liberal Democrat did the same and became the “soul of American” with his conservatism.
Teseract on February 09 at 5:36 p.m.
I find it interesting that people who can afford to own a home and have the credit rating to do so get a tax break, but those of us too poor to do so and have to rent get nothing. Even the landlord gets to claim depreciation, etc. on the rental property.
I say get rid of these tax exemptions and level the playing field a bit and help with budgetary problems at the same time.
woamike on February 09 at 7:07 p.m.
@ Teseract,
I don’t know you and have nothing against you.
regarding people “too poor to [buy a house] and have to rent get nothing” and “get rid of these tax exemptions and level the playing field a bit”
The people you describe generally pay little or no income tax, pay no (direct) property tax and these days are likely to get some form of public assistance. (This may or may not be your case)
What do you mean by “level the playing field” for these people? Since they already pay little or no taxes and may even get Earned Income Tax Credit money, do you mean take money from some other person through the tax code or some other income redistribution scheme and give it to them? What exactly do you mean? Just curious. . .
Alfredo on February 10 at 5:57 a.m.
woamike, even though the poor people whom you obviously detest do not directly pay property taxes, they certainly pay rent which would include property taxes. If a landlord does not figure in the cost of property taxes, they’re pretty much stupid.
woamike on February 10 at 7:54 a.m.
Alfredo,
As usual, you’re all thrust and no vector.
Any evidence whatsoever I “detest” the “poor people”? I didn’t think so.
I already know a portion of property taxes are figured in a person’s rent. You couldn’t figure that out by what I wrote above? what was the point of your post anyway?
Alfredo on February 10 at 8:08 a.m.
You clearly tainted your statement by making it seem as though poor people have no rights to tax breaks that the wealthy enjoy by claiming none of them pay taxes.
You seem rather angry, do you need a hug? Or do you just want the poor people to shut up and support your lifestyle?
Teseract on February 10 at 8:13 p.m.
@woamike: I rent due to issues with my credit rating when I was laid off when my job was moved to India half a decade ago. I’m middle class, and trust me, I pay taxes. Even when I was married with two stepkids and was the only breadwinner in the family I still paid a fair chunk in payroll taxes to the feds. Sure, I got about 60% of that back, but they kept that other 40%. Now that I’m single again, I’m in a much higher tax bracket. I’ve done the math and I’ll be paying a few *thousand* dollars more a year, and I’m hardly in the “rich” income range.
I live in the East Central neighborhood, which is hardly a high class area. For example, over the weekend I was using a vacuum to suck dust bunnies out of the grille over the bathroom ceiling vent. I pulled the cover off accidentally due to the suction, and some nice drug paraphernalia fell out of the vent. No surprise, I’ve been finding used hypodermics in the yard off and on since I moved in. Few things are as scary as having your 7 year old stepdaughter find a used hypodermic needle in the yard and pick it up wondering what it is.
Even if those dastardly poor people who can’t afford to buy a house or don’t qualify for a mortgage don’t pay income tax due to the earned income credit (and this does happen, some people even make a profit) you still pay the 8.7% sales tax. When my landlord’s property taxes go up, my rent goes up too to cover the increase in taxes. I pay utility tax on my Avista bills. I pay taxes when I register my vehicles, when I pay my cell phone bill… it goes on and on.
I personally like the idea of fair and balanced taxes. I know this is a pipe dream as there is no such thing as “fair taxes”, especially when you have politicians involved. If a homeowner, who makes enough money to own and maintain a house, gets a tax break for having to pay the mortgage every month, why should someone who rents (and doesn’t have the benefit of the equity in the house they rent like a property owner does) not have an exemption too, just because they rent?
Again, my opinion is that there shouldn’t be a tax break for either homeowners or renters. I have the opinion that the tax break makes some people who really shouldn’t be buying a house or are considering a house that’s borderline for their income have one more “positive point” in favor of going into many tens of thousands of dollars of debt that they may not be able to afford, in the hope that the tax credit will “balance things out in the long run”. Instead they end up in bankruptcy 5-10 years later when the interest on the credit card they used to make ends meet sucks them under. That isn’t good for anyone.
woamike on February 10 at 10:10 p.m.
Teseract,
Thanks for responding. I agree with your idea of “fair and balanced taxes”, I guess the problem is everyone has a different opinion of what is fair and balanced.
I think the tax code is way too complicated and there are way too many tax deductions and credits. I think EVERYONE should have some skin in the game, even if it’s only a little, even a dollar on your federal income tax. When people have ZERO federal income tax burden, or even worse get earned income tax credit they have no skin in the game and therefore little interest in what the government spends money on as long as they’re not paying. It also creates an unhealthy dependence on government. By saying this, I’m not disparaging them, it’s just human nature to not care, as long as you’re not paying for it or especially, getting it.
BTW, I also think it’s wrong when corporations pay little or no tax thanks to an unholy alliance between themselves and politicians. While capitalism and free markets are on balance good for everyone, CRONY capitalism is wrong and only benefits the particular company and their client politicians. Republican AND Dems are equally guilty of this. Conventional wisdom says Republicans are the primary, if not the exclusive guilty party but, that is nonsense.
Speaking of property taxes, I just got my bill today: $7,968.28. That’s a LOT of money. It’s nearly 10% of my income. $664 a month for the priviledge of living in my own house on my own land. Like you, I work very hard for my wages and I care how my tax dollars are spent and yes, I think my property taxes are too high.
I’m not sure why you used the term “dastardly poor” in your post. Do you think I judge people by their wages and look down on “poor” people? I started out very poor in life and have slowly worked my way “up” to where I now make a comfortable living. It’s taken me 30 years of hard work and many sacrifices to get where I am today. I know what it is to be poor and have to go without the comforts and even necessities of life. I consider anyone who is honest and works hard to be honorable, regardless of their wage.
I still believe in the American Dream that ANYONE who is willing to work hard can improve their lot in life. I come from unpriviledged, non college educated parents. Heck, my dad didn’t even graduate HS. But, they did teach me to work hard and instilled in me the reality that no one owes me anything in this life. For that, I’m truly thankful.
Peace to you and yours. I wish you all the best in your endeavors.
Teseract on February 11 at 7:59 p.m.
@woamike - Seems that we agree mostly on the “core issues”.
I’d have to agree in general that taxes are too high on individuals and we’ve come to live in a society where we’re taxed over and over again on the same income. Your property taxes are a good example.
It makes me wonder how much of a difference property taxes are in the city vs. living in the county. I know that the differences in utility taxes alone make it worthwhile, considering Spokane’s tax structure on utilities. I know my father, who lives in a home that’s probably 50k or so above median price for the Spokane area, pays about a third of what you pay in property taxes a year, but he lives way out in the county. Considering the city government makes the county government look like rocket scientists (and the county government is anything but bright) I’m sure that the property taxes are higher in the city with all the little “add ons” the city government likes to add.
I know that if I ever have the opportunity to purchase a home, I’m going to look for a place outside the city limits. Heck, the next place I move to rent (which will hopefully be soon) will hopefully be outside the city limits. I lived out of town my entire life until I moved where I am 3 years ago, and the city government has done it’s best to make those 3 years a living hell.
williamplantagenet on April 12 at 11:16 a.m.
“Teseract on February 09 at 5:36 p.m.
“I find it interesting that people who can afford to own a home and have the credit rating to do so get a tax break, but those of us too poor to do so and have to rent get nothing. Even the landlord gets to claim depreciation, etc. on the rental property.
“I say get rid of these tax exemptions and level the playing field a bit and help with budgetary problems at the same time.”
I agree! Let’s get to a zero basis flat tax for all with no exemptions, no deductions, and no relevance of marital status.