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Our tax dollars at work

Go out and buy a car this year and save $600 on your taxes. That is the message being touted by Senator Cantwell and Representative Baird

Income tax forms
Income tax forms

at Vancouver Ford yesterday as spewed by our local newspaper’s article, “Residents Reminded of Sales Tax Break”.

Here are a few facts our residents were not reminded about the sales tax break being “sold” by our politicians. According to the Tax Foundation, only 37% of Washingtonians were able to itemize on their 2005 tax returns thereby getting any tax benefit at all. (Being able to itemize is corrected to adjust for inflation every year so this statistic is not likely to change much from year to year).

For those of you in the high end of the income strata, you lose too! These taxes are added back (unlike real estate taxes) for purposes of the alternative minimum tax computation and itemized deductions are also phased out (limited) above certain income levels.

So the bottom line is the deduction for the majority of people not only doesn’t represent a $600 savings if you buy a new car this year, it doesn’t help them at all.

So why are our representatives spending time touting this at our local car dealer? Could it be because it is easier than dealing with the issues of the day that really matter?

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This entry was written by bushtool and posted on November 19, 2007 at 9:02 am and filed under Baird, Brian, Cantwell, Sen Maria, Fiscal policy. Bookmark the permalink. Follow any comments here with the RSS feed for this post. Post a comment or leave a trackback: Trackback URL.

2 Comments so far (Add 1 more)

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  1. Part of the situation is that the standard deduction has been raised to the point it does not make sense for some of us to itemize.

    I know once I went from and emphasis on charitable giving to paying off debt, the standard deduction worked better. The prospect of saving a little may not be worth the effort.

    [reply to this]

    1. Above written by Pat CampbellNo Gravatar on November 19th, 2007 at 4:21 pm (replies, if any, are attributed separately above).

  2. Just don’t understand why, with all the important issues out there that deserve attention, our leaders think it’s at all important to remind people to buy cars so that they (37% or less of them) can use Uncle Sam to help defray the cost of the vehicles.

    Meanwhile we (by we I mean our government) spend ourselves into oblivion with a seemingly endless occupation of a foreign country and fail to regulate, one iota, the mortgage lending industry causing a multitude of fiscal problems and uncertainty, just to name a couple of REAL problems our elected representatives just might want to address.

    These people remind me of Caligula “who fiddled while Rome burned”.

    [reply to this]

    2. Above written by bushtoolNo Gravatar on November 19th, 2007 at 7:16 pm (replies, if any, are attributed separately above).
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