18 Wealthy Families Bankroll Efforts To Repeal Estate Taxes

I rarely, if ever, write on national issues since Texas is so much more my cup of tea and there are so many national bloggers out there.

But, I could not resist noting this Cleveland Plain Dealer story about 18 of America’s wealthiest families bankrolling efforts to permanently repeal estate taxes:

Groups funded by the super-rich have engaged in a deceptive campaign to convince the public that estate taxes cause widespread problems for small businesses and family farms when they actually affect about one in 370 estates, said the report released by Public Citizen and Boston-based United for a Fair Economy.

This year, all assets under $2 million for individuals and under $4 million for couples are exempt from estate taxes. Current tax law will boost those exemptions to $3.5 million and $7 million in 2009, eliminate the estate tax in 2010, and reimpose it in 2011 with a $1 million exemption.

The House voted to permanently repeal the estate tax last year, but the measure stalled in the Senate, where 60 votes are needed to override filibusters. Majority Leader Bill Frist says he will bring the bill up in May.

Ohio Republican Sen. Mike DeWine wants to repeal the tax because he says it hinders economic growth and penalizes society’s most productive members, while Ohio GOP Sen. George Voinovich says the cost of eliminating it is too great: about $290 billion over the next 10 years. Voinovich would prefer a compromise to elevate the minimum threshold for estate tax liability to $3.5 million and regularly adjust it for inflation.

Every time I hear the wealthy carping about the Estate Tax, it pisses me off. It pisses me off even worse when I hear pols like Rep. Louie Gohmert complaining about the Estate Tax. Surely, we can all remember his sad little commercial with the music box from the 2004 GOP Primary where Gohmert claimed it was "all he had left" of his grandmother's estate after the mean, nasty, old tax men forced an auction.

While I've always doubted the veracity of Gohmert's individual claims, the fact is that the estate tax (called the "death tax" by Republicans) isn't going to steal our family farms and small businesses.

Part of the reason for the estat tax's bad rap is because, prior to 200, the part of an estate excluded from taxation wasn't adjusted for inflation. Even so, fewer than 2 percent of estates were subject to the tax:

In 2001, Congress responded with what some call the "Throw Mama from the Train Act." The law lowers tax rates and increases exemptions between 2001 and 2009. Then, the tax is repealed entirely - for one year! After that, it reverts to 2000 levels. In other words, if you're very rich, the best time to die is 2010.

More from the Plain Dealer:

They said families including those that founded Wal-Mart, Gallo wineries, Nordstrom's department stores, Wegman's grocery stores, the Mars candy company, Cox media chain and Campbell Soup Co. joined the Timkens in bankrolling an effort the groups' report called "one of the biggest con jobs in recent history."

The report says the 18 families financed business groups, trade associations and lobbyists to push for their goals. Information about their participation was obtained through lobbying reports and IRS forms filed by anti-tax groups, the report said.

Note that Cox owns several Texas papers, including the Austin American-Statesman.

The Center Center on Budget and Policy Priorities notes that repealing the state tax would add trillions to the deficit, that few estates pay any estate taxes at all, and that the number of small businesses and family farms that owe any estate taxes is shrinking rapidly. Plus, they note that the estate tax does not punish success!

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