The Death Tax is a "Double Tax"

By Rep. Trent Franks  12/11/09 10:21 AM

Red County

 

 During my tenure in Congress, I have seen my share of misleading bill names. Members of Congress unsurprisingly tend to use the most flowery language possible when naming their bills, attempting to cast their proposals in a positive light, potentially glossing over any shortcomings with clever wordplay. But H.R. 4154, the "Permanent Estate Tax Relief for Families, Farmers, and Small Businesses Act" is one of the most egregious examples in recent memory of misleadingly named legislation.

 

The assertion that this bill serves to relieve the tax burden on "families, farmers, and small businesses" is both laughably absurd and completely false. Not only does H.R. 4154 NOT relieve the tax burden on those mentioned, it actually worsens it.

 

In this instance, the logic behind the Democrats' choice of bill name is amusing. For decades, Republicans have fought for a full repeal of the "estate tax," more accurately called the "death tax." With this goal in mind, under the 2001 Bush tax cuts, the death tax was set to steadily decline, leading up to 2010, during which no death tax would be imposed. However, because of the way the legislation was written, the death tax would go back up to Clinton-era levels in excess of 50% in 2011.

 

Instead of acting to extend Republicans' 2001 legislation to decrease the death tax and, at the very least, allowing the death tax rate to continue its downward spiral or, better yet, finally doing away with the tax completely, House Democrats decided to make the death tax permanent at a rate of 45%. The argument, then, is that since the death tax rate would have increased, had Congress done nothing, Democrats are actually doing Americans a FAVOR by making the tax permanent, at the ostensibly "low" rate of 45%.

 

In short, they are saying, "Well, making the death tax permanent is non-negotiable, but we are feeling generous, so instead of charging you 50%, we will only charge you 45%." A 45% tax is the Democrats' idea of tax "relief."

And as burdensome as the death tax would be, it is especially egregious in that the tax is, by its very nature, more unfair than most. The death tax differs in that it taxes someone's entire estate after they die. It is essentially a "double tax;" Americans are already taxed on the money they spend, the money they earn, the money they save, etc...when they are alive. The death tax is the government's second pass -- an attempt to squeeze every penny it can out of someone's estate, before it is passed along to loved ones (after which, of course, it will be taxed yet again, if the money from the estate is spent).

 

Benjamin Franklin famously wrote, "In this world nothing can be said to be certain, except death and taxes." It used to be, however, that, at the very least, death earned you respite from the government's never-ending taxes. But now, in a feat that only Congressional Democrats could achieve, the federal government, discontent with merely overtaxing you while you are alive, is even taxing the dead.

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