Tax Break for Nevadans Under Consideration in Congress
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Updated: 5:42 AM Jun 21, 2004
Tax Break for Nevadans Under Consideration in Congress
Washington, DC
Nevadans might be able to save up to $300 a year in taxes under a bill being considered by Congress.
Posted: 9:25 PM Jun 20, 2004
Reporter: Associated Press
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Nevadans might be able to save up to $300 a year in taxes under a bill being considered by Congress.

As part of a massive tax bill approved by the House on Thursday, taxpayers in states without an income tax would be able to deduct state and local sales taxes from their federal returns for the next two years.

A Senate version of the tax bill does not include a similar provision, and lawmakers will have to resolve the differences before the bill becomes law.

The Congressional Research Services estimated the House measure could save taxpayers $212 million nationwide. Nevada residents paid just over $2 billion in state and local sales tax in 2000, according to estimates the service compiled this month.

Depending on the tax bracket, taxpayers could save $250 to $300 in taxes, said Rep. Kevin Brady, R-Texas, although it would vary from state to state and family to family.

Sales taxes in Nevada vary by county between 6.5 percent and 7.5 percent.

Rep. Jim Gibbons, R-Nev., said the measure "brings back tax fairness."

He said that while residents of other states can deduct state income taxes from their federal returns, taxpayers in Nevada, where there is no income tax, have no similar opportunity.

"Allowing taxpayers in states like Nevada to deduct sales taxes on their federal tax returns is simply a fair solution to an inequity in our tax code," he said.

Nevadans and residents of other states without state income taxes have not had this option since 1986, when Congress removed it. Those states are Texas, Florida, Tennessee, Wyoming, Washington, South Dakota, New Hampshire and Alaska.

All three Nevada congressional representatives said they supported the option for Nevada.

"This levels the playing field and gives us the same tax opportunities as other states," said Rep. Jon Porter, R-Nev.

But although she was a co-sponsor of the bill, Rep. Shelley Berkley, D-Nev., voted against the overall tax measure saying she objected to other items added to it.

"The good news is that after six years, there is finally a move to restore the sales tax deduction," she said, "but the awful news is that it is part of a bill that gives tax incentives for corporations to send American jobs offshore while ballooning the deficit."

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