Washington, D.C. - U.S. Congressman Kevin Brady (R-Texas) wants to preserve a tax deduction that saves Texans more than $1 billion per year on their federal income tax.  Today the House Ways and Means Committee approved a measure allowing Texans who file itemized federal income tax returns to deduct state and local sales taxes, which will expire at the end of this year if Congress does not vote to extend it.

“Working families in Texas – and across America will be saving on their federal tax bill this year with the state Sales Tax Deduction in place,” said Brady who is a member of the Ways and Means Committee and deputy whip.  “This deduction keeps more money in the family budget.”

Congressman Brady led the bi-partisan effort in the U.S. House of Representatives to restore the federal deduction in 2004 and has filed legislation that would make the sales tax deduction permanent.  Once signed into law, the one-year extension would ensure that hardworking Texans can continue taking that deduction through 2008, while we work toward permanency.

Estimates from the Texas Comptroller’s Office indicate that extending the deduction would save Texans a projected $1.2 billion a year, or an average of $520 per filer claiming the deduction.  The Comptroller says continuing the deduction for 2008 and beyond is vital, because it is associated with 15,700 to 25,700 jobs and $1.1 billion and $1.4 billion in gross state product.

Since 2004, residents of Texas, Tennessee, Florida, Nevada, South Dakota, Washington and Wyoming have been able to claim a deduction on their federal income tax for state and local sales and motor vehicle taxes they have paid, giving them a tax break similar to residents of other states, who can deduct their state income tax from their federal income tax.

Congressman Brady holds the leadership post of Deputy Whip and serves on the Ways & Means Committee, which has  jurisdiction over 2/3 of the federal budget including taxes, Social Security, Medicare, international trade and welfare.  He serves on the Social Security and Trade subcommittees.