Washington, D.C. - U.S. Rep. Brian Baird announced today that a provision allowing Washington State residents to deduct their sales taxes from federal income taxes will be attached as an amendment to the Democratic version of the Foreign Sales Corporation (FSC) bill.   Rep. Baird has championed sales tax deduction since coming to Congress in 1998.   Washington, along with six other states, has no state income tax, which means our residents cannot deduct what they pay in state taxes from their federal income tax as residents of other states can.

Congress is under intense pressure to pass the underlying FSC tax reform in response to a World Trade Organization ruling that current U.S. tax policies amount to an unfair subsidy.   European Union nations recently began to impose a tariff on certain U.S. goods and that tariff is set to increase up to $4 billion if Congress fails to pass reforms.

“We have always known that for this legislation to pass we would need to attach it to just the  right vehicle,” said Rep. Baird.  “The FSC bill may be our best opportunity yet and we are hopeful that the stars have finally aligned for our state.  With a bill that must be passed soon and support from our colleagues in Texas, Florida, South Dakota, Tennessee, Nevada and Wyoming, we believe we can prove this is the right thing to do, the fair thing to do, and this is the time to do it.  For Washington State residents, this means more than five hundred million dollars in tax savings every year!”

Rep. Baird is hopeful this effort will receive bipartisan support from all of the impacted states.  With those states including the Majority leaders of both the Senate and House as well as the Senate Minority leader, plus the electoral importance of states like Florida and Tennessee, the opportunity is right to push for passage now. 

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