Estate Tax Repeal Battle

The following excerpts are from Edmund L. Andrews, Estate Tax Showdown Is Splitting the G.O.P., NY Times, June 7, 2006:

Senate Republicans, pushing once again to abolish the estate tax on inherited wealth, are split about whether to push for a full repeal that would probably fail, or seek a more cautious compromise with Democrats that could pass. * * *

Proponents said that repeal of the tax would promote savings and investment and eventually create jobs, as Americans would have more incentive to build businesses if they could keep the wealth within their families.

Critics say the estate tax as it is now reduces some of the nation’s economic inequality, and they insist that its repeal would benefit the very wealthiest families at a time when the government is running large budget deficits.

Most polls show that a slim majority of voters support a repeal of the tax, especially when it is called the “death tax.” But the tax affects less than 2 percent of all estates — most of which belong to very rich families — and repeal would be expensive. * * *

Mr. Frist now appears to be going for broke: instead of seeking a compromise that might win over a handful of crucial Democrats, he is pushing for a permanent repeal of the estate tax.

Though Republican aides say Mr. Frist has not closed off the possibility of a compromise, the senator has pointedly refused to schedule any floor time for debate about alternatives in the event that his own effort fails.