Boston, MA, December 4, 2009 — “More tax breaks for the super wealthy is one of the last things our economy needs right now,” says Lee Farris, Estate Tax Policy Coordinator for United for a Fair Economy (UFE). “Back in 2001, the Bush Administration enacted a massive tax cut for multi-millionaires by gradually reducing the estate tax over several years. Now, instead of reversing at least part of this damaging Bush tax break, the House voted to make that cut permanent.”
Yesterday, the US House of Representatives cast a 225-200 vote in favor of Rep. Earl Pomeroy’s estate tax proposal, which makes 2009 estate tax law permanent, with a $3.5 million exemption ($7 million for married couples), and a 45% tax rate. If no vote were taken, the estate tax would have gone to zero in 2010, then reverted back to pre-2001 levels in 2011. Making the 2009 law permanent would result in a loss of $234 billion over the next 10 years.
Brian Miller, UFE’s Executive Director adds, “The House vote is a mixed blessing. It’s clearly a good thing that the House recognizes the need for an estate tax. However, making the 2009 law permanent amounts to a huge tax giveaway to the super wealthy at a time that our nation has much more pressing needs for that revenue, such as paying for health care and reducing the deficit.”
“We urge the Senate to not give even more tax breaks to the wealthy than the House passed on Thursday,” says Farris. “There’s still time to pass a stronger estate tax. The Senate should pass a one-year extension of 2009 law before the end of this year, so Congress has time for a more meaningful debate of this issue next year.”
UFE continues to support Rep. Jim McDermott’s Sensible Estate Tax Act, HR 2023, which represents a middle ground between the 2009 and pre-2001 laws; the bill would raise $31 billion more in federal revenue over 10 years than the House bill, while improving the tax by indexing it for inflation and rebating money to the states.
United for a Fair Economy is a national, independent, nonpartisan, 501(c)(3) non-profit organization.