Thursday, June 24, 2010

Escalating Estate Tax Proposal Reinforces Reality Disconnect

Senators Sanders (VT), Whitehouse (RI), and Harkin (IA) have introduced an estate tax bill that would establish an escalating estate tax structure starting at 2009's $3.5 mil exemption and 45% rate and capped with a 65% "billionaire's surtax". Here's an excerpt of today's National Review article which is available in its entirety to subscribers:

"According to a letter [the bill sponsors] were circulating, the measure would impose a 10 percent "billionaire's surtax" on the value of inheritances worth more than $500 million per spouse, or $1 billion per couple. That would be on top of a 55 percent rate on the value of estates above $50 million. Below $50 million but above $10 million, and the rate would be 50 percent; and between $3.5 million and $10 million, estate values would be taxed at 45 percent, same as in 2009 law that has since lapsed.Estate values below $3.5 million would go untaxed, also as in the 2009 law"

The article goes on to quote from the same letter, "It's time for multimillionaires and billionaires to pay their fair share," Obviously the concept of double taxation is lost on the bill's sponsors. The bill includes special relief for family farms and landowners which begs the question why all family businesses aren't exempted.

No comments: