September 27, 2006
Dear Majority Leader Frist, Speaker Hastert, Minority Leader Reid and Minority Leader Pelosi:
We are very concerned that our constituents may soon face a substantial tax increase because Congress has failed to pass a tax extenders package that includes sales tax deductibility. As Members of Congress representing the people who face this tax increase, we ask you to bring a tax extenders package to the floors of both the House and Senate before we adjourn this week that includes a multi-year extension of the sales tax deduction.
We strongly believe that the extension of the state sales tax deduction is a matter of tax fairness. As long as taxpayers have the ability to deduct their state and local income taxes, taxpayers in states without an income tax must also have an opportunity to deduct their state and local sales taxes. Unfortunately, as you are aware, the tax deduction for state and local sales taxes expired on December 31, 2005.
Over the last two years, the sales tax deduction has resulted in billions of dollars in tax savings to millions of hardworking taxpayers throughout the United States. These tax savings have meant a boost to the economy in the seven states affected by the deduction - Washington, Texas, Florida, Nevada, Tennessee, South Dakota, and Wyoming.
Failing to extend the sales tax deduction will have a significant impact on taxpayers in our states. Residents of our states need to know that the sales tax deduction will continue so that they can make important day-to-day decisions. Residents in our states are now asking themselves whether they should buy a new car; whether they will be able to use their tax savings to send a child to college in the next few years; and whether they should invest in remodeling their homes.
We thank you for your past support on this important issue for our constituents. We strongly urge you to bring an extension of the sales tax deduction to the floors of both House and Senate before we adjourn this week.
Debbie Wasserman Shultz
Harold Ford, Jr.
Sheila Jackson Lee
Eddie Bernice Johnson
John Duncan, Jr.