Saturday, June 24, 2006

Republican Priorities - More Gifts for the Rich

The estate tax reduction bill that the Republican House passed on Thursday was a compromise. If the GOP-led House had its way, there wouldn't be an estate tax, as they have repeatedly proven over the years by passing countless bills to eliminate it. But after the Senate failed last week in its attempt to eliminate the tax altogether, House Republicans are trying the back door.

House Majority Leader John Boehner, R-Ohio, explained their persistence.
"Americans are being taxed almost every moment of their lives. My goodness, when they are dead, do we have to tax them again?"
Apparently, Congressman Boehner has been channeling the deceased and is really feeling the pressure. Who knew?

By a vote of 269-156, the House approved a bill that would eliminate the estate tax on individual estates up to $5 million ($10 million per couple) with annual adjustments. Yeah, you read that right. The same Republican rubber stamps who haven't voted an increase in the minimum wage for nine years, are so concerned Paris Hilton might have to downgrade from a Lamborghini to a Mercedes, that they decided to index the exemption to keep pace with inflation.

The bill also greatly reduces the tax on wealthier estates. Estates of $10-25 million would be taxed at the same rate at those on capital gains, currently 15% but due to rise to 20% in 2011. Why the rate change? It seems an unnecessary charade when the Republicans will obviously fight tooth and nail to keep that increase from ever happening. But by inserting sunset clauses in the reductions, they can mask the true costs of these bills, chronically underestimating the size of future deficits.
Congressional tax experts estimated that if the changes become law, only 5,100 estates would face taxation when the changes are fully in effect in the fiscal year beginning October 1, 2011. The Internal Revenue Service levied taxes on more than 30,000 estates in 2004, the most recent figure available.
Okay, maybe Alice Walton won't get everything she asked for, but the legislation still means billions in savings for America's ruling class. And the rest of us?

The Joint Tax Committee estimated the cost at $283 billion through 2016. But the Center on Budget and Policy Priorities, a liberal think tank, said the full cost would be about $750 billion for the first 10 years it takes effect.....

Rep. Charles Rangel of New York, the top Democrat on the tax-writing House Ways and Means Committee, said it would benefit the "richest of the rich" while adding to the nation's debt and forcing deep spending cuts in key domestic programs.....
"What we're doing today is ... jeopardizing the resources to pay for health care and education, and even our national defense because some of you believe the richest of the rich should be protected from an equitable distribution of tax liability," Rangel said.

And no Republican bill would be complete without a little pork thrown to special interests, so the bill also contains a reduction in timber taxes to increase it's chance of passage in the Senate.

North Texas Congressmen will be holding town meetings this summer all over the metroplex. I think they have a little explaining to do.

4 comments:

Bradley Bowen said...

As a point of unnecessary clarification, Paris Hilton drives a Bentley. She's also notorious for hitting parked cars.

We should go to the Burgess town hall meeting... I assume he has heard of the Flower Mound Democrats and that's why most of his town hall meetings are far away (Euless, etc.).

Anyway, we should talk about the estate tax sometime. I don't fully understand its implications, but I don't understand what you meant by decreasing the estate tax costing money. It's just less money that the government will have taken from the rich... that doesn't mean that it costs money, it just means that the government will get less than what they had anticipated. I don't know, it's hard to explain what I'm thinking right now.

McBlogger said...

Make sure you call it the heir's tax. I can't stand calling it in the estate tax or the death tax. The dead don't pay anything because they're, you know, DEAD. This is a tax on unearned income no different than winning the lottery.

In this case, the only difference is that the heir won the genetic lottery instead of MegaMillions.

Bradley- a repealed tax or tax cut costs the government because it was money that the government should collect but can't.

texas toad said...

McBlogger

"the only difference is that the heir won the genetic lottery instead of MegaMillions"

Love that.

Bradley - a Bentley! LOL. Now I want to know how you knew that.

Bradley Bowen said...

I saw the pictures online last time she wrecked it.