Support reasonable estate tax
Let’s look at the numbers. The estate tax in the tax compromise package would exempt all estates below $5 million and create a 35 percent maximum tax rate. I supported an amendment that would increase the estate tax to its 2009 level that has an exemption level of $3.5 million and a 45 percent maximum tax rate. This amendment is not radical, and it is certainly well under the estate tax rate that will go back into effect if Congress allowed the Bush tax cuts to lapse entirely.
The cost of the scaled-back estate tax is $23 billion when compared to the 2009 level supported by many Congressional Democrats including myself. I don’t see why we should add this amount to the national deficit to benefit estates worth millions, especially when it won’t help our economy grow. Unfortunately, that amendment failed.
Double taxation critique is a myth
Contrary to arguments that the estate tax is unfair because it is double taxation, the estate tax system is a fair one. In fact, much of the wealth accumulated in many estates of this size has never been taxed. This is because investment gains are not taxed until an investment is sold. When an investment is not sold during someone’s lifetime, the gains on that investment are never taxed. The estate tax steps in to address this issue, but is limited to only very wealth estates.
I’m committed to having a progressive tax code that supports the middle class. Scaling back the estate tax is a step backwards when everyone should be focused on creating a tax code that rebuilds the middle class.