Death for the 'death tax'?
While we're on taxation, it's appropriate to discuss congressional Republicans' renewed efforts to abolish the estate tax.
If you've listened to a few of President Bush's speeches, you may have come to know the tax as the "death tax," an emotionally charged term designed to appeal to listeners' fundamental senses of fairness and justice. Many prominent Republicans have decried the estate tax for forcing inheritors to sell their small businesses and family farms to pay an overwhelming tax bill assessed by greedy bureaucrats who laugh malevolently as they ruin lives.
What estate-tax opponents de-emphasize is that the tax is assessed against only about 2 percent of all estates, according to the Internal Revenue Service. The tax, which due to a legislative quirk will disappear entirely in 2010 before returning the next year, applies only to individual estates worth more than $1.5 million or couples' estates worth more than $3 million. By 2009, those exemptions will rise to $3.5 million and $7 million, respectively.
Were the drive to abolish the estate tax truly motivated by a desire to protect family farms and small businesses, Congress could create additional estate-tax exemptions for such assets or permanently exempt the first $8 million or $10 million of an individual estate to ensure the long-term security of small farms and businesses. But when 51 senators in 2001 voted against legislation that would have increased the individual exemption to $100 million -- far above the amount needed to secure a small farm or business -- they revealed themselves to be concerned not with the little guy but with pure ideology.
A debate over whether inheritances should be taxed at all is a debate worth having. But GOP leaders' assertion that the abolition of the estate tax is the only way to protect family farms and small businesses is a fallacious argument that distracts from the real issues at hand.
If you've listened to a few of President Bush's speeches, you may have come to know the tax as the "death tax," an emotionally charged term designed to appeal to listeners' fundamental senses of fairness and justice. Many prominent Republicans have decried the estate tax for forcing inheritors to sell their small businesses and family farms to pay an overwhelming tax bill assessed by greedy bureaucrats who laugh malevolently as they ruin lives.
What estate-tax opponents de-emphasize is that the tax is assessed against only about 2 percent of all estates, according to the Internal Revenue Service. The tax, which due to a legislative quirk will disappear entirely in 2010 before returning the next year, applies only to individual estates worth more than $1.5 million or couples' estates worth more than $3 million. By 2009, those exemptions will rise to $3.5 million and $7 million, respectively.
Were the drive to abolish the estate tax truly motivated by a desire to protect family farms and small businesses, Congress could create additional estate-tax exemptions for such assets or permanently exempt the first $8 million or $10 million of an individual estate to ensure the long-term security of small farms and businesses. But when 51 senators in 2001 voted against legislation that would have increased the individual exemption to $100 million -- far above the amount needed to secure a small farm or business -- they revealed themselves to be concerned not with the little guy but with pure ideology.
A debate over whether inheritances should be taxed at all is a debate worth having. But GOP leaders' assertion that the abolition of the estate tax is the only way to protect family farms and small businesses is a fallacious argument that distracts from the real issues at hand.
posted by Alabamian at 4:55 PM
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