Seven Reasons Why Congress Should Repeal, Not Fix, the Death Tax

The House and Senate may soon begin debate on what to do with the federal estate tax. If Congress fails to act before January 1, 2010, current law calls for death taxes to disappear entirely for one year before returning in 2011 at a top rate of 55 percent and a $1 million exemption of taxable estate.[1] The 2009 tax rate is 45 percent, and the exemption stands at $3.5 million per taxpayer. What should Congress do? Some Members want to permanently "fix" the death tax by reducing the top rate to 35 percent, which some pro-death tax policymakers suggest is a rate wealthy taxpayers could "afford." However, this would be the wrong move for Congress to make. Instead, policymakers should do what their voters want them to do, as revealed in poll after poll: They should repeal this tax and kill it, once and forever. Americans of all walks of life sense the deep injustice of federal death taxes and the fundamental immorality of bedrock public policies that tell people one thing and do another. Policymakers say, on the one hand, that that if you work hard, save your money, and generally do the right things in your daily life, you will succeed in the U.S. economy. On the other hand, however, these same policymakers support the federal death tax, which has the power to nearly confiscate these hard won economic gains once success is attained...read more