The Real Story Behind Estate Tax Repeal
June 19, 2002
The press cynically assumes the main reason why Congress voted to repeal the estate tax last year is because rich people lobbied them heavily and made large campaign contributions.
This model of what is driving the estate tax debate is wrong on many levels.
- First, campaign contributions are not driving this debate, since the vast bulk of total contributions come from corporate political action committees (PACs) and lobbyists on whom the tax has no effect.
- Second, votes, not money, are what really matter in politics -- which is why the AARP (formerly the American Association of Retired People), the most powerful lobby in Washington, has neither a PAC nor makes any campaign contributions.
- In fact, it's farmers and small businessmen who are the driving force behind repeal -- hardly Forbes 400 material.
- The rich don't care about the estate tax because their money is all tax sheltered in trusts, foundations and other legal devices for avoiding the estate tax entirely.
Despite the demagoguery of left-wing groups, the American people instinctively understand the fundamental unfairness of the estate tax, as national public opinion polls have consistently shown.
- A 1999 poll by Worthlin Worldwide found 70 percent of voters favoring a phase-out of the estate tax.
- A 2000 poll by the Pew Research Center found 71 percent of voters supporting elimination of the inheritance tax.
- A 2001 CBS News/New York Times poll also found 71 percent of people opposing imposition of an estate tax at death.
Vast numbers of Americans who will never pay any estate taxes nevertheless favor its abolition because they understand that it is wrong to tax assets again at death when they have already been taxed heavily many, many times already by federal, state and local governments.
Source: Bruce Bartlett, senior fellow, National Center for Policy Analysis, June 19, 2002.
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