Campaign Issue
Repeal won’t happen anytime soon, not with Obama proposing higher estate taxes and only one Senate Democrat siding with the chamber’s Republicans during a test vote on the issue last month. Instead, the House measure is a marker for the 2016 campaign and a signal from Republicans to business groups that repealing the estate tax is a priority.
“The death tax is the wrong tax at the wrong time, and it hurts the wrong people,” said Representative Kevin Brady, a Texas Republican and the lead sponsor of the House bill.
He said business owners already pay hefty taxes during their lifetimes and said some families’ holdings have been subject to the estate tax multiple times.
“They are double and triple taxed,” he said.
Republicans and business groups point to the difficulties faced by family businesses, including the expenses of tax planning to minimize or avoid the tax.
Asset Rich
“We are often asset-rich but cash-poor,” said Andy Harig, director of government relations for the Food Marketing Institute, which will bring 200 grocers from across the country to Washington this week. “A lot of our members are sometimes surprised when they do the valuation to find out what their businesses are worth.”
Obama and other Democrats say estate tax repeal -- especially now with a $5.43 million per-person exemption -- is actually about protecting the very wealthy.
“One of the laws that my friends on the other side of the aisle are trying to pass right now is a new, deficit-busting tax cut for a fraction of the top one-tenth of 1 percent,” the president said on April 2 in Louisville, Kentucky. “That’s fewer than 50 people here in Kentucky who would, on average, get a couple million dollars in tax breaks.”