CAMP: “Madame Speaker, death should not be a taxable event. Death should not force the sale of family farms or the dissolution of small businesses.”
Washington, D.C. – Ways and Means Ranking Member Dave Camp (R-MI) today voted against H.R. 4154-the Democrats’ Estate Tax Bill. This bill seeks to permanently extend an excessively high tax rate (45%) on an individual’s estates, hurting small businesses and family farms. The $3.5 million exemption limit would not be indexed for inflation, meaning more and more families and small businesses will be affected each year. Below is Rep. Camp’s statement against the bill, followed by background on the estate tax.
Madame Speaker, death should not be a taxable event. Death should not force the sale of family farms or the dissolution of small businesses.
The fear of death should not be a reason for Americans to hire a battery of accountants and lawyers to find legal ways to reduce the bite of the estate tax.
After a long wait, we are about to realize that goal. Set in motion by a law passed by the Republican Congress earlier this decade, there will be no death tax in 2010 – that’s just 29 days away.
The bill before us, however, would resurrect the death tax next month and apply a 45% tax rate to estates above a $3.5 million exemption amount.
The Majority claims to be offering certainty to taxpayers. And I suppose in a way they are. They are certainly repealing the hope of ever eliminating the death tax.
They are replacing that with the certainty of a federal tax rate that, at 45 percent, must be considered confiscatory. No American should have the federal government take nearly half of their worth.
They are providing the certainty of an exemption that is not indexed for inflation, meaning that, over time, it is certain that more and more family farms and small businesses will be subject to this punishing tax.
Madame Speaker, one other thing that is certain about this bill is that it is unlikely to be approved before the end of the year.
As we are all aware, the Senate is fully engaged in a health care debate and is unlikely to break from it to consider this bill this month, particularly since a clear majority of the Senate has indicated its support for a far more robust and bipartisan estate tax relief.
We all understand that the current situation would benefit from a permanent solution. But this is not the right one, and I urge its defeat.
Background: Due to legislation passed by Republicans in 2001, on January 1, 2010 – just four weeks from now – the estate tax is scheduled to be repealed entirely for a full year. The Democrats’ bill would resurrect the death tax in 2010 – rescinding that year of full repeal – and would substitute in its place a high 45% rate and an exemption amount of $3.5 million that would continue to leave many Americans exposed to an unwarranted tax increase next month. Furthermore, H.R. 4154 fails to index the exemption for inflation. Based on historical inflation data, the value of the estate tax exemption could thus be cut in half with every passing generation.