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House Democrats offer bill to expand the estate tax

House Democrats offer bill to expand the estate tax
© Greg Nash

Dozens of House Democrats have introduced legislation to expand the estate tax, as progressives make a push to substantially increase taxes on wealthy individuals.

Rep. Jimmy GomezJimmy GomezHouse Democrats reintroduce bill to reduce lobbyist influence Biden picks leave Democrats with slimmest House majority in modern history Democrats to determine leaders after disappointing election MORE (D-Calif.), the lead sponsor of the bill and a member of the tax-writing House Ways and Means Committee, cast the measure as a way to address inequality in the country.

"Through my legislation – the For the 99.8% Act – we can take a progressive step forward in addressing our country’s rapidly increasing wealth inequality by strengthening the estate tax and ensuring the wealthiest among us pay their fair share," he said in a press release on Friday.

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Gomez's measure is identical to a bill Democratic presidential hopeful Sen. Bernie SandersBernie SandersWhat the shift in Senate control means for marijuana policy reform Business groups prepare for lobbying push against minimum wage Schumer: Senate could pave way for reconciliation on COVID relief next week MORE (I-Vt.) introduced in the Senate earlier this year, according to a spokesman for the congressman.

The House bill has more than three dozen co-sponsors — including prominent progressive Reps. Alexandria Ocasio-CortezAlexandria Ocasio-CortezBernie Sanders has been most-followed member of Congress on social media for six years Meghan McCain responds to Katie Couric: 'I don't need to be deprogrammed' Skepticism reigns as Biden, McConnell begin new era MORE (D-N.Y.), Ilhan OmarIlhan OmarDemocrats poised to impeach Trump again Pence opposes removing Trump under 25th Amendment: reports Pelosi vows to impeach Trump again — if Pence doesn't remove him first MORE (D-Minn.), Rashida TlaibRashida Harbi TlaibBiden and the new Congress must protect Americans from utility shutoffs Overnight Energy: EPA rule exempts many polluting industries from future air regulations | Ex-Michigan governor to be charged over Flint water crisis: report | Officials ousted from White House after papers casting doubt on climate science Ex-Michigan governor to be charged over Flint water crisis: report MORE (D-Mich.) and Ayanna Presssley (D-Mass.). It also has the backing of a number of labor unions and progressive groups.

Under current law, individuals can leave up to $11.4 million to heirs through their estates before the money is taxed. Amounts above that level are taxed at 40 percent.

Under the Democrats' bill, assets between $3.5 million and $10 million would be taxed at a progressive rate structure starting at 45 percent, while the value of estates greater than $1 billion would be taxed at a rate of 77 percent.

The bill is also designed to prevent wealthy people from being able to use certain strategies to avoid paying estate taxes.

The bill's introduction comes as many Democratic lawmakers and presidential candidates have been floating various ways to increase taxes on the rich in order to reduce wealth inequality and raise revenue to finance spending priorities. Several of the 2020 Democratic presidential candidates have said they want to expand the estate tax.

President TrumpDonald TrumpBlinken holds first calls as Biden's secretary of State Senators discussing Trump censure resolution Dobbs: Republicans lost in 2020 because they 'forgot who was the true leader' MORE's 2017 tax-cut law significantly increased the amount of money exempt from the estate tax. Many Republicans want to completely eliminate the tax.