Of all the disputes involved in the ongoing fiscal talks, one that is of transcendent importance to the GOP is the estate tax. If you want to get angry today, consider these numbers provided by WaPo’s Zachary Goldfarb concerning the differences between the administration and congressional GOP proposals:
About 99.9 percent of deaths do not involve people with estates large enough to be taxed. Because of the high threshold, only 3,500 households are set to pay the estate tax this year. Because it mainly affects the ultra-wealthy, the average tax paid is estimated at $3.3 million.
Under the Republican proposal, 3,800 people would pay the estate tax year, also near an average of $3.3 million. The GOP proposal would raise $182 billion for federal tax coffers over the next 10 years.
Under Obama’s proposal, 6,500 people would pay the estate tax next year, with an average payment estimated at about $3 million. The president’s proposal would raise $284 billion in tax revenue over the next 10 years.
So if (as appears to be the drift in the latest reports of negotiations) the GOP prevails, 2,700 Americans would benefit at a ten-year cost of $102 billion. By rough arithmetic, that works out to an average ten-year benefit of a bit over $37,777,000 for the blessed 2,700 and their heirs.
The crazy thing is that the overall politics of the estate tax have actually moved in a progressive direction in recent years. Ten years ago and even less, Republicans were hell-bent on repealing the estate tax entirely (which was the original idea in the original Bush tax cuts); much of the media were echoing the Luntz framing of the levy as a “death tax;” and a shocking number of Democrats were in the mood to cave entirely. Teddy Roosevelt was rolling in his grave. Now he’s just restlessly raging.
