struggling to get by on $20 million, the
is looking out for you and your heirs.
opinion by Chuck Collins
D.C.) -- It isn’t easy being a
millionaire these days, especially if
you’ve got less than $20 million. Fortunately, Congress is watching out
the Republican tax cut bonanza targets lower end millionaires for
relief. Now those struggling to scrape by with $15 million or $20
breathe more easily. And even lowly billionaires will be able to keep
Because Congress just increased the amount of wealth exempted by the
tax, our nation’s only levy on inherited wealth.
the bad old days, a family had to have $11 million in wealth before
subject to the tax. This exempted the 99.8 percent of undisciplined
who, in the words of Iowa Senator Chuck Grassley, had squandered their
women, and movies.”
no family with less than $22 million will pay it (or individuals with
$10.9 million). This gift to “grateful heirs” will cost $83 billion
the estate tax is a bad idea — it raises substantial revenue from those
the greatest capacity to pay. Even in a weakened state, it would have
over $260 billion over the next decade.
the estate tax was created
estate tax was established a century ago during the first Gilded Age, a
of grotesque inequality. Champions of establishing a tax on inherited
included President Theodore Roosevelt and industrialist Andrew
viewed it as a brake on the concentration of wealth and power.
Republicans, however, paint the tyrannical “death tax” as an unfair
small businesses and family farmers. But that’s a myth.
most vocal champion of estate tax repeal is Rep. Kristi Noem, a South
Republican who became the GOP poster child for farmers touched by the
tax. House Speaker Paul Ryan appointed her on the tax conference
advocate for estate tax repeal because of her compelling story.
says her family was subject to the tax after her father died in a farm
in 1994, a story she repeats constantly.
only problem, as journalists recently discovered, is that her family
tax only because of a fluke in South Dakota law that was changed in
experience has little to do with the federal estate tax, which has been
substantially scaled down in recent decades.
while Noem was complaining about government taxes, the family ranch has
collected over $3.7 million in taxpayer funded farm subsidies since
attacked the reporting as “fake news,” even though it was based on
documents she filed herself.
reality is that the small number of estate tax beneficiaries aren’t
mostly wealthy city dwellers.
the fact that the estate tax lives on creates an opportunity to make it
should institute a graduated rate structure, so that billionaires pay a
estate tax rate than families with a “mere” $22 million. And loopholes
be closed so they can’t pay wealth managers to hide their wealth in
trusts and offshore tax havens.
tax revenue could be dedicated to something that clearly expands
for everyone else.
Gates Sr. argues that the estate tax should fund “a GI bill for the
generation.” In exchange for military and community service, young
be able to get substantial tuition assistance for higher education or
vocational training, paid for by a progressive estate tax.
Congress were concerned about the middle class, that’s the kind of
that would become the law of the land.
Collins directs the Program on Inequality
and the Common Good at the Institute for Policy Studies. He’s the
author of the
recent book "Born on Third Base." This report was first
as Otherwords.org and is reprinted here with permission.