The U.S. House of Representatives voted last week to repeal the Federal Death Tax, legally called the Estate Tax. Even if repeal passes in the Republican-controlled Senate, the President will veto it. Nevertheless the left has put itself into a rage. Their arguments against repeal are:
- Repeal would reward the wealthy and then only a very few
- It would punish the poor
- It would perpetuate a new aristocracy
- It would cost the Treasure and contribute to the deficit
- It would exacerbate income inequality
These are weak arguments. They reveal that liberals are envious and hateful, thus their tenacious support of this punitive, unusual, and very stiff tax. They are little concerned with fairness, equity, and the principle of even-handed justice when it comes to their enemies, the evil rich. To our mind, the fewer the people who must pay the estate tax, the more unfair it is. Even if it forces only a single family to sell a business or farm to raise the cash needed to pay the tax, it is discriminatory, punitive, and anti-American. The death of a family member is horrible; the insertion of the greedy hand of the tax man into this event is as unnecessary as it is unseemly.
A few more points. The estate tax is now at the confiscatory level of 40% with an exemption level of $5.43 million. Pace the left, it affects far more than the people who have to pay it, since the desire to avoid or minimize it costs many years of planning with expensive attorneys. How many people know when they are going to die and how much their business or farm will be valued at that time? These planning and other costs, which otherwise would have gone into growing a business, amount to a large percentage of the tax revenues gained. Thus this is an inefficient tax as well as an unfair one. While accumulating the estate paid tax upon tax; a new tax payable on death is unfair double taxation. The motivation for passing wealth on to children is a family value, as well as a great motivation for economic growth – resulting in increased tax revenues. This tax is anti-family. Inherited wealth and life insurance payments are generally not considered income at the Federal level, with the exception of tax-deferred retirement accounts. But if death is not a taxable event for inheritance, why should it be a taxable event for estates? Sweden and Norway, those bastions of progressivism, recently repealed their estate taxes. By liberal logic, should we not follow suit?
The only real question remaining is not why should the estate tax be repealed, but why the Republican Senate will not also vote to repeal? Perhaps for the same reason that ten Republican Senators voted today to confirm Loretta Lynch for Attorney General despite her support of Obama’s unconstitutional executive actions.