Skip to comments.Kill the Death Tax, Once and for All ("No Taxation Without Respiration")
Posted on 04/16/2010 6:58:30 AM PDT by SeekAndFind
The federal death tax today stands at zero percent, and it should stay there. Republicans and free-marketeers should kill the death tax once and for all before it roars back next January 1. If the Democratic Left defends the death tax, the Republican Right should beat them on it at the polls next November.
If Congress does nothing, the death tax will be resurrected at 55 percent after a $1 million exclusion. According to the Wall Street Journal, Democrats wish to restore last years 45 percent death tax beyond a $3.5 million exclusion. Republicans seem to prefer a 35 percent death tax above a $5 million exclusion.
In this case, gradualism buys the GOP nothing. A 35 percent death tax would make Republicans complicit in reviving perhaps the most widely hated levy on the books. Instead, they should make Americans cheer by hammering a stake through the heart of the death tax.
This taxs cruelty may be its worst aspect. Not long after loved ones perish, mourning survivors must calculate how much of the deceaseds wealth to surrender to Washington, D.C. This turns a situation from sad to worse. Relatives and friends of dead people whose estates are subject to the death tax should be free to cry their eyes out in sorrow without thinking about accountants and trust lawyers.
The money that is subject to the death tax almost always has been taxed at least once by the feds. So why tax it again? Death alone should be no reason to let Uncle Sam raid and then re-raid anyones bank account.
This convoluted levy, which generated $25.7 billion in federal revenues in 2008, actually may be a net drain on the Treasury. A 2006 Congressional Joint Economic Committee study indicated that the death taxs high compliance costs and impact on capital accumulation may actually cause income tax revenue losses for the federal government.
The IRSs own website warns: The laws on Estate and Gift Taxes are considered to be some of the most complicated in the Internal Revenue Code. For further guidance, we strongly recommend that you visit with an estate tax practitioner (Attorney or CPA) who has considerable experience in this field.
This entire nation would benefit if all of this legal, accounting, and finance talent plus the resources required to pay them instead could be devoted to more productive purposes.
Some wealthy people believe the death tax should survive so that the heirs of rich parents will not loaf around waiting for Ma and Pa to expire.
Dynastic wealth, the enemy of a meritocracy, is on the rise, giga-investor Warren Buffett told Forbes magazine. A progressive and meaningful estate tax is needed to curb the movement of a democracy toward plutocracy.
If layabout children bother Buffet and his demographic, they are perfectly free to chop their kids clean out of their wills. If announced in advance, this would send the message: Get a job!
Furthermore, if this evacuate the yacht club argument held any water, Congress could reform the death tax by letting Uncle Sam simply confiscate 100 percent of all assets above a decedents first $1 million. How would Buffet and company like to see that scenario befall their fortunes?
The death tax even harms the environment. In order to pay the death tax, usually due nine months after the departeds death, survivors sometimes sell ranches, farms, and other acreage. This, in turn, can get subdivided for housing, retail, and commercial-real-estate projects. That may be splendid for human beings, but it can eliminate the habitats of suddenly paved-over wildlife.
Republican lawmakers should pledge to keep this chamber of horrors locked up, rather than allow it to reopen for only 35 cents on the tax dollar. In fighting for the permanent death of the death tax, free-marketeers should quote publisher Steve Forbes on this issue. As he likes to say, No taxation without respiration.
Deroy Murdock is a nationally syndicated columnist with the Scripps Howard News Service and a media fellow with the Hoover Institution on War, Revolution, and Peace at Stanford University.
The dems will never end the death tax.
It’s up to us to make sure that we control congress in November.
There are many issues, and the appropriations committee must be controlled by conservative republicans.
That is how we defund their assault on the USA.
The Dems also cheated, gamed the rules, and didn’t care whose re-election possibilities they’d trash to get their Obamanation of a law passed.
The Republicans always played within the rules. . .and got caught by a Senate rule on the 10-year provision, as I recall. .. We should have just “deemed it invalid”, and we wouldn’t be in this pickle. . .
When the Repubs were in charge, they didn't either.