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Monday, March 26, 2007
Senate Budget Debate: A Glance Back at the Estate Tax
In her recent blog Estate Tax: The Senate Does the Right Thing Rejecting Kyl and Nelson Amendments, Linda Beale, law professor at Wayne State University Law School, expresses gratitude that the Senate did not adopt any of the three estate tax amendments it voted on last week during its budget resolution deliberations.
Professor Beale goes on to add:
There is one not-so-bright note. The Baucus amendment to permanently extend the 2009 estate tax provisions--a $3.5 million exemption ($7 million per couple) and a 45 percent rate--was approved by the Senate. That is both too high (the exemption amount) and too low (the rate), but it is better than the Kyl and Nelson amendments.
Two points:
- both Kyl and Baucus have now shifted significantly further away from what once were pro-repeal positions on the estate tax. In 2006, Kyl proposed exemption at $5 million and a top of 15 percent -- 84 percent of the cost of repeal. Last week, he came in at $5 miilion and a 35 percent rate. Baucus last year proposed a $3.5 million exemption level, with a tiered rate structure of 15 percent, 25 percent and, for estates over $10 million, 35 percent -- 74 percent of repeal. Last week he proposed making the 2009 estate tax provisions permanent, $3.5 million exemption with a top rate of 45 percent -- 40 percent of the cost of repeal.
- given what a grab-bag of mixed fruit the Baucus amendment was, you cannot infer 97 votes for Baucus' estate tax position from the 97-1 vote for his amendment overall, but progressives have long regarded settling at the 2009 rate as a fiscal and moral victory
The ground has shifted in the Senate on the estate tax.
Posted by Dana Chasin
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