As they gear up for the fall elections the Republicans are planning to make an issue of the forthcoming Obama tax increases slated to go into effect on January 1, 2011.
One legislator preparing to take a leadership role in this fight is South Carolina Republican Sen. Jim DeMint, who plans to force a vote on an amendment to permanently kill the death tax as part of the Senate’s debate on the small business bill.
“If President Obama and the Democrats get their way, Washington could get over half of family estates, farms, and small businesses, a greater inheritance than the children of the deceased,” DeMint said in a release. Moreover, a dramatic increase in the death tax rate would have a negative impact on the U.S. economy. One econometric analysis conducted by former Congressional Budget Office Director Douglas Holtz-Eakin and Stephen Entin, president of the Institute for the Research on the Economics of Taxation, found that the projected hike in the death tax to 55 percent could destroy as many as 500,000 American jobs even if the planned $1 million exemption for individuals and $2 million exemption for couples is maintained.
That same analysis determined that permanently eliminating the death tax, as DeMint and others would like to do, could lead to the creation of at least 1.5 million new jobs at a time when they are badly needed.
“The death tax kills jobs, hurts small businesses, destroys family farms and President Obama’s plan to hike it from zero percent to 55 percent next year is unconscionable,” DeMint says. “The death tax is an unfair, immoral double tax on property and assets that folks have already paid taxes on throughout their lives.”
An enormously unpopular tax, according to most all the current survey data, it has long been the target of efforts in Congress to kill it permanently--a move the Democratic leadership has repeatedly blocked. Currently the death tax rate is zero but, unless Congress acts, it goes back up to 55 percent at the beginning of next year.