WASHINGTON - Today, Ways and Means Committee Member Danny K. Davis (D-IL) on the House floor led the Democratic opposition to H.R. 622, which would make permanent the state and local sales tax deduction, adding $42 billion in debt. His prepared remarks:
The State and Local Sales Tax Deduction is an important tax provision for Americans living in states without a state income tax who cannot take advantage of the State and Local Income Tax Deduction.
Although I support this deduction as an important alternative for taxpayers in states without income taxes, H.R. 622 is fiscally irresponsible given that it permanently extends this deduction without any offsets.
Frankly, I am quite surprised that the Republican Leadership is advancing this bill that would add $42 billion to the deficit. Just last year, then-Chairman Dave Camp proposed eliminating the State and Local Sales Tax Deduction in the Republican tax reform draft. At that time, current-Chairman Ryan said he approved of eliminating the sales tax provision before us.
Further, just last month, the Republican Leadership presented a budget that requires offsetting the cost of any tax extenders that are made permanent with other revenue measures. Indeed, the GOP budget principle is in line with the Republican tax reform draft last year, which adopted a fiscally-responsible approach.
So, I am at a loss to understand why the Republican Leadership is adding $42 billion to our deficit to permanently extend a provision it thinks should be repealed. This bill, coupled with the estate tax repeal, would balloon our deficit by over $300 billion - almost half of the amount the Republican Budget said we must cut from domestic programs. The Republican Budget said that we had to cut $759 billion over the next 10 years in domestic discretionary spending in the name of fiscal prudence, but the Republican Leadership can throw $300 billion to the wind for a provision that they have proposed eliminating in tax reform and for an average tax cut of $3 million dollars for the 0.2 percent of Americans.
We need to provide certainty to taxpayers in affected states that the sales tax deduction will be available to them this year, and then we need to focus on comprehensive reform. This bill moves us farther away from tax reform, not closer.
In addition to being fiscally-irresponsible, this bill coupled with the estate tax repeal, reflect misplaced priorities for this House. Rather than pushing a piece-meal, deficit-inflating agenda, we should help hard-working American families by raising the minimum wage, ensuring equal pay for equal work, making college more affordable by increasing the Pell grants and improving student loans, helping low-income families afford quality child care, encouraging work via effective tax programs, improving investment in low-income communities, and strengthening the research innovation and competitive of our nation, just to name a few policies we should advance to increase fairness in our nation.
I am ready to work with the Majority on tax reform; however, I cannot support this piece-meal, fiscally-irresponsible approach and urge my colleagues to oppose this bill.
