Inheritance tax opponent crafting modified plan
WASHINGTON -- One of the Senate's staunchest opponents of the estate tax has drafted an inheritance tax plan that would keep it intact in a modified version, breaking a long-held Republican taboo against any plan that does not fully abolish the "death tax."
Senator Jon Kyl, an Arizona Republican, has taken pains to keep his efforts secret, but his proposal -- detailed in internal e-mails and confirmed by business lobbyists -- would raise the estate tax exemption to $15 million for individuals and $30 million for couples and lower the tax rate on inherited assets above that level to 15 percent, the rate on capital gains and dividends. One e-mail suggested that for small businesses, the 15 percent rate would not be a "business-ending event."
Republicans succeeded in 2001 in enacting legislation that would repeal the estate tax in 2010 but would allow it to revive again the following year when the legislation expires. Since then, an effort has been underway to kill the estate tax permanently.
Kyl's efforts indicate the depth of concern among estate tax opponents that, because of surging budget deficits and rising public opposition to President Bush's economic policies, they might not prevail. And if a Democrat were to be elected president next year, that would end all hopes even for significant cuts to the estate tax.
