The Senate Finance Committee voted Thursday to extend a number of tax provisions that have recently expired, or were scheduled to expire. Among them is a provision to allow for the deduction of state and local sales taxes from federal income tax returns.
The provision was first authored by Senator Kay Bailey Hutchison and was incorporated in the tax relief bill passed in 2004. It expired at the end of 2011. Senator Hutchison issued the following statement:
"The state and local sales tax deduction has always been an issue of fairness for me. When I was State Treasurer I fought to make sure Texas did not enact a state income tax.
"Since I arrived in the Senate, I have offered this bill to make sure Texas residents are treated fairly under the U.S. tax code, when it comes to state tax deductions. Residents of states with income taxes are routinely allowed to deduct those taxes from their federal returns. Since Texas residents pay no income tax, it is only fair that they should be allowed to deduct a portion of the local taxes they do pay from their federal tax obligation.
"This state and local tax deduction would save the average Texas taxpayer $520 per year.
"I am pleased that the Senate Finance Committee has taken this action."