House Republicans on Thursday passed their version of a new tax plan, which was approved by a vote of 227-205. Thirteen Republicans voted against the bill.
Rep. Jaime Herrera Beutler, R-Battle Ground, announced her support for the bill Wednesday ahead of the vote. She said the bill is a “good deal for Southwest Washington taxpayers.”
“I proudly voted today to help middle-income Southwest Washington families keep almost $2,000 more of their money instead of paying it in taxes, and to boost their paychecks by $2,672 each year,” Herrera Beutler said.
The House bill would reduce federal taxes for about 92 percent of Americans, anywhere between 3 and 5 percent based on the four proposed tax brackets. Those reductions are good for the next five years.
In 2023, only 40 percent of Americans will pay less and 22 percent will pay more, according to a report by the Joint Committee on Taxation. Many of those hikes are for people with incomes between $40,000 and $75,000. A large contributor to those delayed hikes is the sunset of the Family Flexibilty Credit, which would expire in 2022.
The bill also eliminates nearly all itemized deductions, including the state and local tax deduction utilized by many Washingtonians.
The final House tax plan keeps the mortgage interest deduction — now capped at $500,000 instead of $1 million — and deductions for charitable donations and property taxes up to $10,000 annually.
Many groups, including the Association of Washington Housing Authorities, are concerned about the bill’s effects. Another elimination in the plan is tax-exempt private-activity bonds, often used for the development of affordable housing.
“In the last 5 years alone, Housing Authorities have issued or have plans to issue private activity bonds in excess of $596 million. These bonds have attracted additional private investment in excess of $379 million and led to the development of 4,977 units of affordable housing,” according to a AWHA press release.
Some of the developments are planned for Vancouver.
“We are gravely concerned because these developments would allow more than 4,000 people in Washington to move into decent, affordable housing that is so desperately needed in our state,” said Karen Miller, chair of the Washington State Housing Finance Commission.
The Senate will consider its version next week. If it’s approved, the two chambers would begin to consolidate the two plans.
