Federal Budget & Tax

Federal Budget & Tax: News Blog Background

Wednesday, April 27, 2005

WA Passes New Stand-Alone State Estate Tax

As support for the estate tax continues to flounder somewhat at the national level, the state of Washington recently demonstrated their support of the estate tax by approving on April 24 a new stand-alone estate tax that is expected to generate nearly $140 million of state revenue over the next two years.

This move is especially significant because in February, the Washington State Supreme Court "threw out" the state's existing estate tax for various technical reasons, costing the state roughly $430 million in state revenues. However, in resistance to this, Governor Christine Gregoire (D-WA) included the estate tax in her budget proposal. State legislators rallied around her decision and passed the bill, which is now headed to the Governor for her signature.

The Washington estate tax will apply to estates worth more than $1.5 million. In 2006, that level will rise to $2 million. An estimated 250 Washington estates will be subject to tax each year.

Posted by Becky Lewis, 07:16:43 PM

Thursday, April 14, 2005

House Passes Estate Tax Repeal Bill

Yesterday afternoon the House passed H.R. 8, a bill to permanently repeal the estate tax by a vote of 272 - 162. Forty-two Democrats supported the bill. This total was similar to the vote in 2003 to repeal the tax, which had 41 Democrats supporting it.

2005 estate tax repeal roll call vote
2003 estate tax repeal roll call vote

Rep. Earl Pomeroy (D-ND) offered a substitute to this bill that would have immediately increased estate tax exemption levels to $3 million ($6 million for couples). The Pomeroy substitute would have eventually raised estate tax exemption levels to $3.5 million ($7 million for couples) after 2009 . The Pomeroy substitute would cost less than a fourth ($72 billion) of the cost of full repeal ($290 billion) over the next ten years. The vote on this amendment to reform rather than repeal the tax was closer, but failed 194 - 238, with all but 9 Democrats voting to support it.

2005 Pomeroy amendment roll call vote
2003 Pomeroy amendment roll call vote

A few details of the votes:

Democrats Bean (IL), Cramer (AL), and Gordon (TN) voted against the Pomeroy amendment but for H.R. 8.
Pomeroy had the support of one Republican on his amendment - Michael Castle of DE.
Jim Leach of IA was the lone Republican to vote against H.R. 8.

Read more...

Posted by Adam Hughes, 10:35:36 AM

Tuesday, April 12, 2005

House to Vote on Estate Tax Repeal Wednesday

On Wednesday the House is slated to vote on H.R. 8, a bill to repeal the estate tax. The House has passed this bill in years past, and will most likely pass it again. The cost of repealing the estate tax over a ten year period would come out to be $745 billion. Click here for more information on repeal costs.

President Bush is busy ranting that we don't have enough money to continue Social Security payments as they are, and at the same time Congress is set to pass an extremely austere budget resolution for FY 2006 that cuts billions of dollars from funding for social programs. Yet this push to further gut national coffers and appeal to the interests of the wealthiest in our country exists as a very real threat.

The Washington Post has published two insightful columns this week discussing the issue of the estate tax and how it fits into the larger tax and budget picture. Click below to read the articles.

The Rich Get Richer

The Paris Hilton Tax Cut

Posted by Becky Lewis, 12:47:34 PM

Wednesday, April 06, 2005

Senator Schumer to Lead Search for Compromise on Estate Tax

It was reported this morning in The Hill newspaper that Senator Charles Schumer (D-NY) has been tapped to lead an effort to find a permanent compromise on the estate tax.

The current law includes a gradual phase-out of the estate tax - only to have it re-emerge in 2011 at 2001 levels. This structure makes estate planning difficult and both Democrats and Republicans have commented that the issue of uncertainty needs to be addressed.

You can read The Hill article here.

Posted by Adam Hughes, 01:22:06 PM

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