In order to give the economy a much-needed boost, Congressman Zach Wamp voted in favor of the President's economic stimulus package that was considered on the floor of the House of Representatives today.  The legislation, the Jobs and Growth Tax Reconciliation Act of 2003 passed the House 222 to 203.

"Bold measures need to be taken to rejuvenate our economy and by cutting taxes and creating more jobs, we can hopefully get back on track.   Although I am disappointed the sales tax equity amendment was not considered in the House, I will continue to work with Ways and Means Committee Chairman Bill Thomas (R-CA) and the other Members from the seven states affected, to get this provision passed.  This issue is far from being over." said Wamp, an early architect of the Sales Tax Equity Act. "Allowing Tennesseans to deduct sales taxes would be a huge boost to families and local governments."

Taxpayers in Tennessee, Alaska, Texas, Florida, Washington, South Dakota, Nevada and Wyoming are not allowed to deduct their sales tax from their federal income tax in lieu of the state income tax that the other 43 states can deduct. The Sales Tax Equity Act, written by Rep. Kevin Brady (R- TX) and strongly supported by Wamp, will allow taxpayers to deduct the sales tax and as a result eliminate the disparity between these seven states and the rest of the country.  

Earlier this week while he was in Arkansas, President Bush talked about the importance of passing today's tax package to help reduce the unemployment rate in America. "In order to offset any deficit, you've got to have more revenues. The best way to have more revenues is to encourage economic growth. The more economic growth there is, the more people who are working, the more likely it is you're going to get more revenues into the Treasury of the United States. I'm concerned about the deficit. But I'm, first and foremost, concerned about that person looking for a job," said President Bush.

According to the Heritage Foundation, a respected Washington, DC think tank, the state of Tennessee will have an increase of 16,546 jobs in 2004 and an average increase of 11,486 jobs per year between 2004 and 2008 with the passage of this tax relief package. 

The Jobs and Growth Tax Reconciliation Act of 2003 contains the following provisions:

Acceleration of 2001 Tax Cuts for Individual

           -Child credit - Increases child credit to $1,000 for 2003, 2004, and 2005.

           -Marriage penalty relief - Accelerate the expansion of the 15 percent bracket and the increase in the standard deduction for married persons filing joint returns for 2003, 2004, and 2005.

           -Individual rate cuts - Accelerate the 2006 individual rate cut schedule to 2003.  (Rates reduced from 28% to 25%; 31% to 28%; 36% to 33% and 39.6% to 35%.)

           -Increase individual AMT exemption amount - Increases the AMT exemption amount by $7,500 for single persons and $15,000 for joint filers for 2003, 2004 and 2005.  Business and investment incentives.

        -Small business expensing ? For 2003 through 2007, increase the amount the small businesses can expense (immediately deduct) from $25,000 to $100,000.  Increase definition of small business from $200,000 of capital purchases to $400,000.  Provisions are indexed for inflation.

        -Dividends and capital gains

        -Dividend and capital gain tax rate reduction  ? Reduces the tax rate on dividends and capital gains to 5 percent for taxpayers in the lowest tax brackets and to 15 percent for all other taxpayers.