Americans Support Reforming, Not Repealing Estate Tax; Cuts in the Estate Tax Rank Dead Last Among Tax Cut Alternatives

6/12/2002

From: David Bloomgren of Americans for a Fair Estate Tax, 202-326-1815

WASHINGTON, June 12 -- As the U.S. Senate prepares to vote on estate tax repeal, the Americans for a Fair Estate Tax today released a new poll that shows nearly two out of three Americans support reform over repeal.

"A broad majority of Americans support reforming the estate tax to protect small business owners and family farms over permanent repeal that gives more tax breaks to multi-millionaires at the expense of 98 percent of taxpayers," said Senator Kent Conrad at a press conference today at the U.S. Capitol.

The poll, conducted on Americans' perceptions of estate tax repeal, found that after hearing balanced arguments on this issue, 58 percent of likely voters support reform that protects small business owners and family farms while only 37 percent support repeal of the estate tax. When voters learn more about the issue, support for reform grows to more than two to one. By a margin of 67 to 27 percent, Americans support reform over repeal once they hear more information about who pays the estate tax and what repeal of the tax would cost.

"As early as today, the U.S. Senate is looking to pass harmful legislation that will shift tax burdens from the two percent of the super-wealthy to the 98 percent of Americans not now paying the estate tax," said William Gates Sr. of Responsible Wealth, a national network of affluent Americans advocating shared prosperity. "Congress should reject the notion of wholesale repeal in the short term because it is fiscally reckless, and in the long term because we recognize the importance of protecting our democracy from a further buildup of hereditary wealth."

The poll also found that tax cuts rank six out of eight priorities for the federal budget. Cuts in the estate tax rank dead last among tax cut alternatives offered, a result consistent with polling conducted by NBC News and The Wall Street Journal since 1998. Furthermore, voters are sharply focused on priorities that benefit all Americans - including increasing spending for education and health care, and strengthening Social Security and Medicare.

"The proposal to permanently repeal the estate tax is fiscally irresponsible," said Gary D. Bass, executive director of OMB Watch and chair of Americans for a Fair Estate Tax. "Instead of a tax break for multi-millionaires, we should honor our commitments to strengthen Medicare and Social Security, improve education, and fight terrorism."

Under current law, estates of up to $3.5 million for any individual or $7 million for a couple will be exempt from any estate tax when the reforms are fully phased in by 2009. The proposal in the U.S. Senate would permanently repeal the tax and would cost $850 billion over the next two decades and $56 billion in the first full year of repeal. This provides relief to an extremely limited number of Americans. For example, just 24 estates in Maine, 54 estates in Louisiana, and 129 estates in Missouri would receive relief.

According to Charlotte L. McConnell, executive director of Family and Child Services of Washington, D.C. and an Americans for a Fair Estate Tax member, permanent repeal would have an adverse affect on charities. It would affect government resources available for service delivery as well as charitable giving. The estate tax generated $15 billion in charitable bequests in 1999.

"At a time when resources are needed at the community level, it is wrong to repeal the estate tax. We should not provide a tax break for the wealthiest Americans when services to families are not adequately funded," said McConnell.

About the Poll: The national survey was of 1,000 likely voters conducted May 6-9, 2002 by Greenberg. Quinlan, & Rosner Research. The findings have a margin of error of (plus)/- 3.1 percent.

About Americans for a Fair Estate Tax: AFET is a broad-based non-partisan coalition of nonprofit groups advocating for estate tax reform that would ensure that family farms and small businesses are not unfairly taxed while keeping 98 percent of taxpayers exempt. For more information, please call 202-234-8494 or visit our Web site at http://www.fairestatetax.org.