We'll take pro-growth victories wherever we can find them these days, and last week saw a small one in the U.S. Senate, of all places. The Members voted 51-48 to cut permanently the death tax rate to 35% and exempt all estates of less than $10 million per couple ($5 million for a single taxpayer) from any tax. President Obama wants a 45% rate with only a $7 million exemption.Every Republican voted for the lower rate, and so did 10 Democrats. This is the closest thing to bipartisanship we've seen so far this year on Capitol Hill, but naturally the White House and most of the media are appalled. Their idea of bipartisanship is when three Republicans cross party lines to pass $780 billion in "stimulus" spending...
We've long argued that the fairest death tax rate is zero, because the money was already taxed when it was earned. Assets, such as stocks or property, in estates that have appreciated in value over time should be taxed at the capital gains rate of 15% in the year of the sale. These two changes would prevent the all-too-common and tragic firesale of businesses and farms when a family member dies. Senator Jim DeMint of South Carolina proposed an amendment to abolish the estate tax, but Mr. Reid blocked even a vote. Ah, the new bipartisanship.
He should listen to Senator Lincoln, who talked about the Arkansas companies and farmers whose assets are looted by the estate tax. "These are the people," she explained, "who employ more than half the workers in Arkansas. These are the people who, if we reform the estate tax, will invest in their businesses and create more jobs." Evidently, if they aren't government jobs, Mr. Reid isn't much interested. The battle now goes to a House-Senate conference, where liberals plan to strip the lower death tax rate. These days, the political class is so voracious that even taking 35% of a man's lifetime savings is insufficient.
(Wall Street Journal editorial, April 9th)
