Mercury Rising

Click here to find out how. As for why, here's what OMB Watch has to say:

Repealing the estate tax will give more tax breaks for the wealthy while having devastating consequences for lower and middle-income taxpayers. Only the richest 1 - 2 percent of our nation's families currently pay any estate tax at all. These are people with estates larger than $1.5 million for an individual or $3 million for a couple. These exemption levels will rise to $3.5 million ($7 million for a couple) by 2009. Nearly half of all estate taxes are paid by the wealthiest 0.1 percent of the American population – a few thousand families each year. Repealing the estate tax would result in multi-million dollar tax cuts to the heirs of America's millionaires and billionaires, concentrating wealth and political power in fewer hands. Eliminating the estate tax will reduce federal revenue by nearly $1 trillion over the first ten years of full repeal, a serious blow to the Treasury at a time of when we face the growing fiscal challenges of an aging population, rising health care costs, unmet education needs, homeland security, and other challenges still unknown. This revenue loss will be made up by raising taxes on lower and middle-income taxpayers and/or by cutting services that families depend on. Repeal of the estate tax would also have a harmful impact on charitable giving to colleges, hospitals, museums, and nonprofit and charitable organizations assisting the poor and disadvantaged. The estate tax is scheduled to be completely repealed only in 2010 and then fully reinstated in 2011. However, pro-repeal forces in the U.S. Congress are continuing to push for permanent repeal or for an acceleration of the repeal date.

America has entered a new Gilded Age yet our leaders lack the fortitude to do anything about it. Income and wealth inequality in the U.S. has risen dramatically over the last 20 years. Today, the wealthiest 20 percent of Americans take in fully half of the country's income while the poorest fifth takes in just 3.5 percent. The notion of permanently repealing the estate tax in this context is plainly anti-democratic. Perhaps our leaders should take a cue from Theodore Roosevelt, who helped end the first Gilded Age. Roosevelt made the argument for taxing inheritance almost a century ago, claiming that the "really big fortune, the swollen fortune, by the mere fact of its size acquires qualities which differentiate it in kind as well as in degree from what is possessed by men of relatively small means. Roosevelt also stated: “We are bound in honor to refuse to listen to those men would make us desist from the effort to do away with the inequality, which means injustice; the inequality of right, opportunity, of privilege.” Don’t believe the lies about small business and family farms being hurt by the estate tax. The sole claim that persuades many middle- and working-class Americans to support the estate tax repeal is that it will benefit small businesses and family farms. But virtually all family farms and small businesses are already exempt from the estate tax. As the New York Times reports, "Even one of the leading advocates for repeal of estate taxes, the American Farm Bureau Federation, said it could not cite a single example of a farm lost because of estate taxes." So-called compromise proposals on the estate tax are nothing but a wolf in sheep’s clothing. Sen. Jon Kyl, who is leading Republicans in negotiations on the estate tax, has been pushing to not only lower the rate to 15 percent, but also increase the per couple exemption to $20 million. The Washington Post calls the plan "a Trojan horse proposal that amounts to repeal in disguise." And no wonder: Kyl's proposal would cost 94 percent as much as repeal. Even combining a 15 percent top rate with a lower $5 million per couple exemption would still cost 82 percent as much as repeal. With the top marginal rate at 15 percent, the effective tax rate—the share of an estate actually paid in taxes—would actually slump to an average of 5 to 6 percent.

# posted by Phoenix Woman @ 6/30/2005 09:21:00 PM