Democratic Repeal Of Inheritance Tax
On June 7, 2001, President Bush signed into law the Economic Growth and Tax Relief Reconciliation Act of 2001. |
Among the many changes to the tax laws is the so-called Estate Tax repeal. The 2011 the tax law is scheduled to completely revert to its status prior before the enactment of the Estate Tax repeal. The repeal encompasses a host of taxes among them Estate tax which is slated to be completely repealed in 2010.
Before enactment of the new law Federal tax was exempt on the first $675,000 of a taxable estate and taxable lifetime transfer. This amount was scheduled to be increased to $1 million in 2006.
Repeal of estate tax or near-enough repeal, would represent a massive tax cut for the beneficiaries of the wealthy-bracket with the working class Americans footing the bill. A complete repeal including interest payments on additional debt would cost the country nearly $1 trillion in the first ten years of implementation. This would add to the current annual deficit of $7.7 trillion. While the nation as a whole would bear this crippling cost, only a few of the super-rich heirs would stand to benefit.
Obama has a fourfold approach to economic reform. One of the factors is he wishes to retain an inheritance tax on the wealthy; a move that is being hotly contested. Obama is aware of the pitfalls in a society which hinges all opportunity and privilege essentially on one’s parents’ wealth. What was disturbing to him was the implication of creating a society based on wealth concession and opening that was inherited. He is concerned that America will revert to a society with a privileged class.
Obama’s proposal was that estate tax would be effectively repealed for 99.7 percent of estates, and retained at a 45 percent rate for estates valued at over $7 million per couple. This would cut the number of estates covered by the tax by 84 percent relative to 2000 and impact only the wealthy.
More Articles :
|
