OMB Watch submitted a Statement for the record to the Senate Finance Committee to accompany the Committee report on yesterday's hearing, "Federal Estate Tax: Uncertainty in Planning Under the Current Law."

The Statement addressed the irregularities of the estate tax under current law facing taxpayers and tax planners as well as the important principles behind the estate tax. We hope the Committee and other policymakers will heed these:

OMB Watch favors an estate tax regime without any of the anomalies, gimmicks, and trap doors embedded in the current law. We strongly believe estate tax reform must not exacerbate the national deficit or force otherwise unnecessary and less progressive tax increases — there are certainly ways to structure a reform that is revenue neutral. We also believe it is crucial for any reform to maintain the important incentive for charitable giving present in the estate tax and honor the national commitment to social and economic mobility and equality of opportunity.

We were particularly encouraged to hear this message echoed in the testimony of Warren Buffett. Perhaps the most important message of the day was driven home by Mr. Buffett: "A meaningful estate tax is needed to prevent our democracy from becoming a dynastic plutocracy."

Today, the Senate Finance Committee heard from Warren Buffett and other witnesses about the merits and demerits of the federal estate tax at a hearing entitled "Uncertainty in Planning Under the Current Law."

Interestingly, BNA's write-up of the hearing summarized the position of the Committee Chair as follows:

The leadership of the Senate Finance Committee agreed Nov. 14 that they should pursue permanent repeal of the estate tax. "The estate tax is complicated and intimidating. It needs serious reform," Senate Finance Committee Chairman Max Baucus (D-Mont.) said at a hearing on the issue. "I support repeal."

In fact, these comments were from Sen. Baucus' opening statement. The reporter did not bother with his conclusory remarks, which went much further. To paraphrase, he said that everyone in the room knows that the federal estate tax will not be repealed, and he appealed to the witnesses for some guidance as to the appropriate exemption and rate levels.

He also made it clear that while action on the estate tax sometime in the next two years was necessary, it is by no means the most pressing item on the nation's tax policy agenda.

CLARIFICATION: The BNA article that we reference in this blog post was published before the end of the estate tax hearing in question as part of BNA's Daily Real Time Updates. While the article was still misleading, it may have been unavoidable due to publishing deadlines. BNA published more complete and improved coverage of the hearing this morning available here ($).