House Expected To Pass Estate Bill
Friday, June 9th 2000, 12:00 am
By: News On 6
WASHINGTON (AP) â€” Responding to farmers and small-business owners like Mark Sincavage of Blakeslee, Pa., the House today opened debate on legislation that would repeal the federal estate tax gradually over the next decade.
``We will erase it from the tax code forever, in hopes it will never return from the dead to haunt family farms and businesses,'' said Rep. Bill Archer, R-Texas, chairman of the House Ways and Means Committee.
Later today, the House was expected to vote overwhelmingly to gradually repeal the estate tax by 2010 using an estimated $105 billion from the projected budget surplus. President Clinton has threatened a veto over the cost â€” roughly $50 billion a year after full repeal takes effect â€” but sponsors, including at least 46 Democrats, are hoping a big majority vote might persuade the president otherwise.
``It's wrong for the government to steal a family's legacy,'' said House Majority Leader Dick Armey, R-Texas. ``It's not about money at all.''
Arguing that the bill would mainly benefit the rich, Democratic opponents offered a less costly alternative geared directly toward small-business owners and family farms, but it was unlikely to pass.
Sincavage, owner of a land excavation and development business, says his family has paid more than $600,000 in estate taxes and legal fees since his mother died in 1999. Much of his business, he says, will be sold to make up the loss.
``My family worked hard, and we paid all our personal and business taxes for more than 35 years,'' Sincavage said. ``We're going to have to sell a large chunk of our family property just to pay this unfair tax.''
Clinton, in a letter Thursday to House Speaker Dennis Hastert, R-Ill., said he could support ``targeted, fiscally responsible legislation to make the estate tax fairer, simpler, and more efficient.''
He said he favored a Democratic alternative, but was willing to work with the GOP leadership to find an acceptable bill. But, he added, ``If you send me a bill to completely repeal the estate tax, I will veto it rather than risk the fiscal progress that has contributed to the longest economic expansion in history.''
Almost half of estate tax revenue is paid from a small number of estates worth $5 million and up. Only a tiny fraction of farms and small businesses pay the tax because of generous exemptions â€” $675,000 this year for individuals, $1.3 million for farms and small businesses â€” but the stories of people like Sincavage has made the issue irresistible in an election-year Congress.
It is also a priority for many black and Hispanic lawmakers, who say their constituents fear the tax would threaten businesses they are now trying to build.
``You do have a number of small-business people, ranchers, farmers, who are trying to pass their farm or their business to the next generation without paying a high tax. I sympathize with them,'' said House Minority Leader Dick Gephardt, D-Mo.
Many Democrats say the Republican bill goes too far, giving huge tax breaks to the wealthiest people in America in the name of the little guys. They are proposing an alternative that would cost far less â€” about $22 billion over 10 years â€” and would gear tax relief more directly to family farms and small businesses. It would also cut estate tax rates by 20 percent in 2001.
``Our bill does much more for family farms and small businesses,'' said Rep. Charles Stenholm, D-Texas.
But supporters of complete repeal say the Democratic version would only provide modest relief from a tax that a wide majority of Americans oppose, according to public opinion polls.
``We want to do much more than just take the steam out of repealing the death tax,'' said Rep. Jennifer Dunn, R-Wash., a prime sponsor along with Rep. John Tanner, D-Tenn. ``We want to get rid of it.''
The bill is the latest example of this year's House Republican strategy to carve up last year's $792 billion tax cut that Clinton vetoed and pass the more popular items individually. The House has already passed relief from the ``marriage penalty'' paid by millions of two-income couples and more bills are planned.
There is support for estate tax repeal in the Senate, but GOP leaders say the measure would likely have to be combined with several other tax measures and brought up under special rules that prevent unrelated amendments from being attached.
The bill is H.R. 8.
On the Net:
Estate tax opponents: http://www.deathtax.com