Sales tax deduction battle: Here we go again

WASHINGTON – They’re known as tax extenders, and in the arcane world of the Internal Revenue Service code they include renewing tax breaks for everything from motor sports entertainment complexes to rum distillers in Puerto Rico and the U.S. Virgin Islands.

To residents of Washington and six other states, they’re all about being able to continue deducting state and local sales taxes on their federal returns. By some estimates, the deduction saves Washington’s taxpayers between $350 million and $500 million annually.

But the sales tax deduction has to be renewed every year. This year is no exception, as Congress again wrangles over the extenders amid tax policy politics, with chairmen counting votes, fiscal conservatives screaming about how to pay for them and taxpayers waiting anxiously.

Last week, a $50 billion extenders tax bill remained bottled up in the Senate after supporters fell 10 votes short of the 60 needed to cut off debate. Even as the sales tax deduction and other tax breaks are set to expire at the end of the year, it could be next year before Congress acts on them.

And to those in charge of writing the tax laws on Capitol Hill, what’s known as “extenders fatigue” has set in.

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