US Senate May Vote For Permanent Death Tax Repeal

by Mike Godfrey, Tax-News.com, Washington

29 May 2002

The US Congress is squaring up for a final battle over the long-term future of the tax cuts enacted in last year's $1.6 trillion package. As it passed into law, the package contained 10-year cuts in various taxes which would then be reversed in 2011. The House of Representatives has already passed a bill which would make these cuts permanent at an additional cost to 2012 of $373 billion, but the Senate is now considering a bill which would single out just the estate tax for permanent removal at a cost of $99 billion.

For the Democrat-controlled Senate to prefer cutting the estate tax (widely held to apply mostly to richer people) to other taxes such as the marriage tax ($16 billion), the new 10% tax bracket ($79 billion), or the expanded child tax credit ($35 billion), requires some explanation, and it is presumably to be found in the lobbying system.

Estate-tax repeal would stand no chance of repeal if it didn't have substantial support among Democratic senators, given the need for 60 votes to overcome a filibuster. There are however said to be eight or nine Democrats, including Senate Finance Committee Chairman Max Baucus, who are preparing to support the measure, which will come up for a vote later this week.

Senate Majority Leader Tom Daschle thinks he still has a good chance of keeping enough of his unruly flock in line to keep the measure from getting 60 votes, but everything is still to play for in the coming days.

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