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The Latest News on the Estate Tax

February 18, 2004
New Report: Assessing the Impact of State Estate Taxes
Center on Budget and Policy Priorities

This report addresses some facts about state estate taxes that helps put their impact in perspective. It finds that the decision by states to retain their own estate tax will not affect the vast majority of Americans.

UFE, Responsible Wealth and allied organizations National Priorities Project, OMB Watch, and Americans for a Fair Estate Tax are releasing state-by-state reports that show how estate tax repeal would devastate charities and cut funds available for public services. Press briefings are being held in the following states: Arkansas, Indiana, Louisiana, Maine, Minnesota, Ohio, Oregon, and Washington.

With the support of 26 of Oregon's 30 Senators, and 53 of Oregon's 60 Representatives, the Oregon Legislature enacted a bill to preserve the state's estate tax. The strong bi-partisan support for the bill should send a loud message to Oregon's congressional delegation that they should all be supporting reform, not repeal, of the estate tax. Many people worked hard all session to make this happen.

June 18, 2003
House Again Passes Estate Tax Repeal, 264-163

The bill did pass (as we expected), with a similar margin to the 2002 vote. The bill is not yet scheduled for a vote in the Senate, where it has failed repeatedly.

We and our allies sent out thousands of emails and generated hundreds of calls to targeted Representatives who have voted for repeal in the past, such as Russ Holt (NJ), Rick Larsen (WA), Darlene Hooley (OR) and 33 other target districts.

The good news is that we believe we can hold off permanent repeal in the US Senate and keep building support for reform. One lobbyist told the Washington Post today that support for estate tax repeal has “plateaued” because of swollen budget deficits, and some backers of the repeal effort are now realizing they need to work for reform.

We ask supporters of estate tax reform to write letters to the editor and op-eds in the key Senate target states. For instance, in Maine we will dramatize the difference between the House members (who voted against repeal) and the two Senators who have supported repeal. You can contact us for ideas.

On Capitol Hill, Bill Gates, Sr. joined a national farmers group, a business owner, and two Congressional Representatives in urging the House of Representatives not to pass H.R. 8. This bill would permanently extend the currently temporary repeal of the federal estate tax in 2010.

• William H. Gates, Sr., chairman of the Bill and Melinda Gates Foundation, board member of the United Way of America, author of "Wealth and Our Commonwealth: Why America Should Tax Accumulated Fortunes"

• Tom Buis, Vice President of Government Relations, National Farmers Union

• Seth Goldman, co-founder of Honest Tea
  Mr. Goldman is a successful business owner, interested in leaving his business to his children, and who believes his estate should be taxed.

• Rep. Earl Pomeroy of North Dakota

• Rep. Jim Marshall of Georgia

Julie Hirschfeld Davis reports in The Baltimore Sun that House Republicans intend to exploit the expansion of the child tax credit to attach permanent repeal of the estate tax: “Conservative Republicans in the Senate and House, who are loath to give a tax credit to people who earn too little to owe income taxes, are pushing to pair [an extension of child tax credits to low-income taxpayers] with other long-sought tax cuts, such as a repeal of the estate tax.”

As US forces prepared to invade Iraq, Sen. Jon Kyl (R-AZ), the Senate leader of the estate tax repeal cause, put forward an amendment to accelerate the repeal of the estate tax by one year.

Thanks to UFE activists, we generated hundreds of calls to Senators with the basic message: “Vote NO on estate tax repeal” and “Why are you even considering a tax cut for the wealthy during a time of war?”

The Senate voted, during the first day of war, to pass the amendment 51-48. This incremental change doesn’t make estate tax repeal “permanent” – that would require 60 votes.

So the good news is we switched a number of votes. Repeal forces started the day with 57 votes for repeal. Five Senators who have historically voted FOR repeal changed their vote and voted against the amendment. This is very significant.

The five Senators who did the right thing and switched their votes (Please THANK THEM by email or by phone):

• Mary Landrieu (D-LA) (202) 224-5824 email form

• Evan Bayh (D-IN) (202) 224-5623 email form

• Susan Collins (R-ME) (202) 224-2523 senator@collins.senate.gov

• Olympia Snowe (R-ME) (202) 224-5344 olympia@snowe.senate.gov

• Max Baucus (D-MT) (202) 224-2651 email form

Republicans Lincoln Chaffee (R-RI) and John McCain (R-AZ) continued their opposition to repeal.

Two of our Republican targets who continued to vote FOR REPEAL:
George Voinovich (R-OH)
Sen. Arlen Specter (R-PA)

Democrats who still voted FOR REPEAL during a mobilization for war:
Blanche Lincoln (D-AR)
Ben Nelson (D-NE)
Bill Nelson (D-FL)
Ron Wyden (D-OR)

Zell Miller (D-GA) did not vote.

Complete roll call vote

March 2, 2003
Bill Gates, Sr. Joins the National Farmers Union to Demand Reform of the Estate Tax, Not Repeal

Anaheim, CA - Two weeks after Republican Congressional leaders announced that permanent repeal of the estate tax was one of their top 10 legislative priorities, Bill Gates, Sr. called for the reform of the estate tax, not repeal, as the keynote speaker at the 101st Anniversary Convention of the National Farmers Union (NFU). The NFU represents nearly 300,000 farming and ranching families across the United States. | Press Release

More information on how the estate tax affects farmers

Hundreds of people concerned about growing economic inequality packed community meetings in Seattle, Pasadena, San Francisco, Oakland, and Portland for events featuring Bill Gates, Sr. and UFE Program Director Chuck Collins. The events are part of a nationwide grassroots campaign to preserve the estate tax. Gates and Collins are the authors of Wealth and Our Commonwealth: Why America Should Tax Accumulated Fortunes.

	Crowd at estate tax event in Boston, Jan. 16, 2003. Photo: Bill Morse

Hundreds of people concerned about growing economic inequality packed community meetings in Washington, New York, Boston, and Portland for events featuring Bill Gates, Sr., Rev. Jim Wallis of Call to Renewal (in D.C.), and New York Times columnist Paul Krugman (in N.Y.). The events are part of a nationwide grassroots campaign to preserve the estate tax. Gates is the co-author of Wealth and Our Commonwealth: Why America Should Tax Accumulated Fortunes.

Nation's wealth disparity widens, but report shows 52% of families own stocks USA Today, 1/22/03

Kent Conrad of North Dakota, ranking Democrat on the Senate Budget Committee, called today for scaling back reductions in the estate tax that are scheduled to go into effect later this decade. Conrad spoke at a press conference [organized by United for a Fair Economy and Responsible Wealth] attended by Bill Gates Sr., the father of the founder of Microsoft Corp., and George Soros, chairman of Soros Fund Management.

Gates and Soros argue that lowering or repealing the estate tax will exacerbate the gap between rich and poor and will reduce revenue needed to support government services. Soros said the estate tax was the "least damaging" form of taxation because it does not affect the motivation of talented people to take risks and work hard.

At a news conference on the federal budget situation, Republican Senator George Voinovich of Ohio said that while he supported making Bush's 2001 tax cuts permanent, he has "some concern" about the estate tax. "I think that there may be another approach on that issue," he said.

This is welcome news. In the past, Voinovich has repeatedly voted to repeal the estate tax. His statement indicates that there may be an emerging move among moderate Republicans to reform, rather than repeal, the tax.

Dear Friends,

We have our work cut out for us.

Preserving the federal estate tax will be harder in the coming year, given the shift in control of the U.S. Senate.

Can you imagine what kind of country we will become if President Bush and his patrons succeed in eliminating the estate tax? Precisely at the moment when we are experiencing the greatest levels of wealth and income inequality in eight decades, our elected leaders are going to throw fuel on the fire.

Our country’s founders fought a revolution to throw off an aristocracy. In 1916, we instituted an estate tax in response to the excessive inequality of the Gilded Age. At that time, populist farmers, urban reformers, Andrew Carnegie and President Theodore Roosevelt all understood that the American experiment was threatened by the extreme concentrations of wealth and power at the turn of century. The estate tax helped level the playing field and strengthen equality of opportunity.

In 2001, some of you joined Responsible Wealth and United for a Fair Economy’s “Call to Preserve the Estate Tax.” (If you haven’t, please sign here at our web site). Hundreds of people signed on in the Spring of 2001 and over 1,000 Americans likely to owe estate taxes signed our petition urging reform, but not abolition of the federal estate tax.

Together, we had an impact. We shifted the debate about the estate tax and about what claim our society has on great fortunes. Congress passed the 2001 Bush tax cut, but the estate tax repeal that takes place for one year, in 2010, is not permanent. In June 2002, we fended off a serious threat to make repeal permanent. With both houses of Congress in GOP control, pro-repeal forces are primed to finish the job.

First, the good news: Senate budget rules require 60 votes to make the repeal of the estate tax permanent. Our preliminary post-election count indicates that they are still short the votes needed for repeal.

Now, the bad news: These rules expire in April! At that point, the Senate could make repeal of the estate tax and other tax cuts permanent with a simple majority vote.

We’ve been preparing for this moment. We have a plan!

• In the coming months, we will launch, with allied organizations and Congressional leaders, an organizing campaign to promote legislation to reform the estate tax.

• In January, Beacon Press will publish a new book, Wealth and Our Commonwealth: Why America Should Tax Accumulated Fortunes by William H. Gates, Sr. and myself. Former Federal Reserve chairman Paul Volcker wrote a stunning forward. The purpose of the book is to generate a great deal of publicity for this vital effort.

• We are planning a book promotion and organizing tour that will kick off in January in Washington, DC. Bill Gates and I will travel to 15 cities and enlist hundreds of other wealthy Americans to publicize this effort.

• We’ve hired Lee Farris, a veteran organizer, to coordinate our field campaign and rapid response network, enlisting grassroots organizations and local activists around the country to lobby to preserve the estate tax. We’ve forged new alliances to speak out against repeal, including farmers, small business owners, land conservancies and charity groups.

Please explore this web site to find out how you can be involved. Please feel free to contact Lee Farris to plug in. She can be reached at lfarris@faireconomy.org or at (617) 423-2148 x33.

Thanks,

Chuck Collins
Program Director
ccollins@faireconomy.org

Request for Financial Support
We need your financial support to succeed. I’m asking you to write two checks. One to our tax exempt 501(c)3 organization, United for a Fair Economy. The second to the Fair Economy Action Fund, a 501(c)4 organization set up to facilitate more direct lobbying and advertising on this issue. You can give securely online, or mail your contributions to:

Responsible Wealth
37 Temple Place, 2nd Floor
Boston, MA 02111

Let me know if you would like to see a more detailed proposal.

--Chuck Collins (ccollins@faireconomy.org)

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