
 |
|
June 17, 2013
June 12, 2013
Stephanie Hanes: Little girls or little women? The Disney princess effect
Fred Weir: In tweak to US, Russia would 'consider' asylum for Snowden
June 10, 2013
The Kosher Gourmet by Anjali Prasertong: A tart filling so good it might not make it to the crust
June 5, 2013
John Rosemond: Mom, Dad: Talk More and listen less
Kristen Chick: Egypt court sentences 43 pro-democracy workers to prison
June 3, 2013
Molly Hennessy-Fiske: Military judge to consider letting Fort Hood shooting defendant represent himself
May 29, 2013
Andrew Connelly and Helene Bienvenu: The Little Synagogue that Refused to Die
May 24, 2013
Rabbi Tzvi Hersh Weinreb: When I didn't so 'humbly disagree'
May 22, 2013
John Thorne:
They launched the 'Arab Spring' but now yearn for the good old days of a strongman
May 20, 2013
Richard A. Serrano: Is Meir Kahane's assassin now a changed man?
Melissa Healy: Genetic copies of living people from embryos no longer science fiction
Jewz in the Newz by Nate Bloom : Jews Inducted into Rock Hall of Fame; Anton Yelchin co-stars in New "Trek" film; Kutcher (but not Kunis) visits Israel; Jewish TV Star Praises Jewish Rap Star
The Kosher Gourmet by Cathy Pollak: WARNING: This WALNUT CAKE WITH PRALINE FROSTING, perfect for afternoon coffee, is addicting
|
| |
Jewish World Review
Jan. 4, 2010
/ 18 Teves 5770
Let's keep the death tax dead
By
Jeff Jacoby
http://www.JewishWorldReview.com |
Not all deaths are sad. The federal estate tax died at 12:01 A.M. on January 1, an occasion of joy if there ever was one. Allowing it to expire was one of the few sensible things Congress accomplished in 2009. Keeping it dead should be a congressional goal for 2010.
Estate-tax repeal was one element of the tax cuts George W. Bush signed into law in his first year as president. But the legislation was perversely drafted. It phased out the tax over 10 years, reducing the rate from 55 percent in 2001 to 45 percent in 2009, and then eliminating it entirely in 2010 - but only for a year. If Congress does nothing else, the estate tax will reappear in 2011, at the old rate of 55 percent on all assets above $1 million.
Needless to say, this temporary vanishing act is wreaking havoc on estate planning, and many analysts expect lawmakers to revive the tax sometime this year, perhaps even making it retroactive to January 1. But if the goal is clarity and certainty in the tax code, a far better option would be to make the repeal permanent.
To class warriors, of course, abolition of the estate tax is a disgrace. The American Prospect's Tim Fernholz wonders why foes of the estate tax are so keen on "lining the pockets of the already-wealthy," and bristles at the thought of not taxing "folks who inherit huge fortunes" when their parents die. "It makes little sense," declaims USA Today in a recent editorial, "to shower tax breaks on a tiny sliver of the nation's wealthiest citizens."
But the nation's wealthiest citizens aren't the ones the estate tax hurts.
The Rockefeller, Buffett, and Kennedy fortunes are secure, shielded from the IRS by flocks of tax lawyers and accountants. As Henry J. Aaron of the Brookings Institution and Boston College economist Alicia Munnell have sardonically observed, estate taxes "are penalties on those who neglect to plan ahead or who retain unskilled estate planners." Populist rhetoric notwithstanding, they add, American estate taxes "have failed to achieve their intended purposes. They raise little revenue. They impose large excess burdens. They are unfair."
Far from affecting only billionaires and pampered heiresses inheritance tax supporters love to invoke Paris Hilton taxes on estates are mostly levied on small- to medium-sized businesses and family-owned farms. Between 1995 and 2004, the congressional Joint Economic Committee noted in a 2006 report, estate taxes were paid by the owners of more than 37,000 "closely-held businesses," as well as 24,000 farms, 50,000 limited partnerships, and nearly 28,000 other non-corporate businesses. "These data clearly indicate," said the JEC, "that the estate tax has broad and significant costs for thousands of family businesses."
Since many such businesses operate without large cash reserves, a hefty tax bill can leave them with no option but to liquidate valuable assets or sell off the business entirely. The cumulative cost to the economy can be measured in lower growth, lost jobs, and diminished entrepreneurship. According to a 2009 study by Douglas Holtz-Eakin, the former director of the Congressional Budget Office, permanent abolition of the estate "would raise the probability of hiring by 8.6 percent, increase payrolls by 2.6 percent, and expand investment by 3 percent. . . . [T]his translates to roughly 1.5 million additional small business jobs." It also translates to higher federal revenues not the first time a tax cut would yield an increase in tax dollars collected.
But while the practical and economic arguments against the estate tax are many and strong, it is the moral argument that really hits home.
The estate tax is pernicious because it punishes precisely the kind of behavior society should want to reward work, prudence, savings and it rewards behavior that should be discouraged profligacy, overconsumption, and leisure. The easiest way to avoid all death taxes, after all, is to spend your money before you go. Work hard, reinvest your earnings, and leave your life's savings to your loved ones, on the other hand, and the IRS becomes one of your heirs. As economist Arthur Laffer memorably put it in an essay last year, "Spend It in Vegas, or Die Paying Taxes." That is hardly the message we should want our tax laws to convey.
Every weekday JewishWorldReview.com publishes what many in the media and Washington consider "must-reading". Sign up for the daily JWR update. It's free. Just click here.
Jeff Jacoby is a Boston Globe columnist. Comment by clicking here.
Jeff Jacoby Archives
© 2006, Boston Globe
|
|

Arnold Ahlert
Mitch Albom
Jay Ambrose
Michael Barone
Barrywood
Lori Borgman
Stratfor Briefing
Mona Charen
Linda Chavez
Richard Z. Chesnoff
Ann Coulter
Greg Crosby
Larry Elder
Suzanne Fields
Christine Flowers
Peter Funt
Frank J. Gaffney
Bernie Goldberg
Jonah Goldberg
Julia Gorin
Jonathan Gurwitz
Paul Greenberg
Argus Hamilton
Victor Davis Hanson
Betsy Hart
Ron Hart
Nat Hentoff
A. Barton Hinkle
Jeff Jacoby
Paul Johnson
John Kass
Jack Kelly
Ch. Krauthammer
David Limbaugh
Kathryn Lopez
Rich Lowry
Michelle Malkin
Jackie Mason
Ann McFeatters
Dale McFeatters
Dana Milbank
Jeanne Moos
Dick Morris
Jim Mullen
Deroy Murdock
Judge A. Napolitano
Bill O'Reilly
Clarence Page
Kathleen Parker
Star Parker
Dennis Prager
Wesley Pruden
Tom Purcell
Sharon Randall
Michael Reagan
Robert Robb
Cokie & Steve Roberts
Heather Robinson
Debra J. Saunders
Martin Schram
Greg Schwem
Culture Shlock
David Shribman
Roger Simon
Lenore Skenazy
Michael Smerconish
Thomas Sowell
Mark Steyn
John Stossel
Cal Thomas
Dan Thomasson
Bob Tyrrell
Diana West
Dave Weinbaum
George Will
Walter Williams
Byron York
Cathy Young
Mort Zuckerman

Eric Allie
Robert Arial
Chuck Asay
Baloo
Nate Beeler
Lisa Benson
Chip Bok
Dry Bones
John Branch
Daryl Cagle
Patrick Chappatte
John Cole
Paul Combs
J. D. Crowe
John Darkow
Bill Day
John Deering
Sean Delonas
Brian Duffy
Everything's Relative
Randall Enos
Mallard Fillmore
David Fitzsimmons
Glenn Foden
Jake Fuller
Bob Gorrel
Walt Handelsman
Joe Heller
David Hitch
Jerry Holbert
David Horsey
Lee Judge
Steve Kelley
Mike Keefe
Jeff Koterba
Dick Locher
Chan Lowe
Jimmy Margulies
Gary McCoy
Rick McKee
Jack Ohman
Jeff Parker
Milt Priggee
Michael Ramirez
Rob Rogers
Steve Sack
Bill Schorr
Drew Sheneman
Kevin Siers
David Ray Skinner
Jeff Stahler
Scott Stantis
Danna Summers
Gary Varvel
Kirk Walters
Christopher Weyant
Larry Wright
Dan Wasserman
Adam Zyglis

Tech Q&A
Mr. Know-It-All
Ask Doctor K
Richard Lederer
Frugal Living
On Nutrition
Bookmark These
Bruce Williams
|