Letter from John Horejsi
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As many readers may already know, the estate tax has been cut five times since 2001, with the result that few people pay it now – only 1 in 400 Americans. A couple can pass on $7 million tax-free, and a single person, $3.5 million.
So, what is the problem with this? For many of us, there are several problems. The first one is this: Repealing the estate tax would increase the federal deficit by $1.3 trillion over 10 years and leave the struggling middle class even worse off. A second problem is that cutting the estate tax again would give a huge tax break to the very same corporate executives and Wall Street speculators who wrecked the economy and then paid themselves multi-million dollar bonuses after taxpayers bailed them out. Do these folks, the people who helped wreck our economy, need more government relief?
What readers may not know is that a few super-wealthy families who own giant companies like Mars Candy, Gallo Wines, and Wal-Mart have funded the anti-estate tax campaign. These folks are not looking out for the common good, not looking out for the most vulnerable as well those of us who work hard for a living and still have problems meeting our financial obligations.
In 2010, debate over the permanent estate tax will be taking place, and the Senate will be the main battleground. There are several plans already on the table. One on the table is The Sensible Estate Tax Plan. Rep. Jim McDermott (Wash.) introduced a bill — the Sensible Estate Tax Act, HR 2023 – that sets the exemption at $4 million per married couple ($2 million per individual) and establishes a progressive rate structure starting at 45 percent, with a higher rate of 55 percent on estates above $10 million. SALT believes that the McDermott bill would result in billions more revenue and would be more effective at reducing economic inequality than the current Obama proposal. The bill is the most fiscally responsible bill of all current proposals.
John Horejsi is the founder and coordinator of the Vienna, Va.,-based Social Action Linking Together.