House Republicans Mark Tax Day with Tax Cut Vote for Millionaires
Americans filed their taxes across the United States on Wednesday. In Washington, the day was a prime opportunity to showcase tax cuts.
House Republicans marked the day with a vote to repeal a tax that most Americans will never face.
The estate tax is a tax on the estate of deceased taxpayers. An estate would need to be valued at $5.43 million for a single person or $10.9 million for a married couple in 2015 to be levied the tax.
Any portion of the estate over the exemption amount is subject to a 40 percent tax, but due to other exemptions and loopholes, the effective tax rate is only 9.9 percent. Only the wealthiest 0.2 percent of taxpayers are impacted.
The estate tax has been a target of Republicans for years. They say that it unfairly targets wealthy taxpayers.
Critics of the Republican plan to repeal the estate tax deride it as a “Paris Hilton tax cut” and say that it would create a “permanent elite of trust-fund babies.”
As Dana Milbank argues in the Washington Post:
The estate tax was a meaningful check on a permanent aristocracy as recently as 2001, when there were taxes on the portion of estates above $675,000; even then there were plenty of ways for the rich to shelter money for their heirs. As the son of a schoolteacher and a cabinetmaker, I’d like to see the estate tax exemptions lowered — so that taxes encourage enterprise and entrepreneurship while keeping to a minimum the number of Americans born who will never have to work a day in their lives.
The repeal of the estate tax would have fiscal repercussions, costing the federal government $269 billion over a ten year period. All of that would be added to the federal deficit since the House Republican plan does not include any offsets.
While passage seems guaranteed in the Republican-controlled House, Democrats have vowed to block it in the Senate. Even if the bill were to reach President Obama’s desk, the White House has said that the president would veto it.
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