The class warfare rhetoric that accompanies the tax debate is reigniting as congressional lawmakers battle over how to address a pending increase of the estate tax, also known as “the death tax.”
The current rate of the tax, which is imposed on the transfer of the estate upon an individual’s death, is a component of President George W. Bush’s tax cuts that are slated to expire at the end of the year.
If Congress doesn’t come to an agreement, the estate tax will spike from 35 percent to 55 percent, with a $1 million exemption. The debacle has distressed Republicans, and even some Democrats, who represent farm and ranching districts, where those who inherit family farms or ranches often cannot afford to hang on to their inheritance because of the tax liability. “It is one of the hardest issues for Democrats,” including Senate Majority Leader Harry Reid (D-Nev.), said Jim Manley, a former adviser to Reid. “There is a minority of Democrats, some from rural or swing states, who have been very vocal in raising their objections to raising” the inheritance tax.
Republicans brought the issue to light Wednesday when Senate Democrats precluded the estate tax in legislation to renew the Bush tax cuts for earners making less than $250,000. Commenting on the matter, Republican Senate Minority Leader Mitch McConnell (R-Ky.) asserted, "Tens of thousands of small and mid-sized family businesses across the country will be broken up and handed over to the government.”
Citing the Joint Committee on Taxation, Republicans say the 20-percent increase will boost the number of taxable estates from 3,600 to 55,200. “Remember, Americans work all their life paying income taxes, property taxes, sales taxes — only to have the government raid their farms, ranches and small businesses when they pass away,” Sen. Orin Hatch (R-Utah) said in a statement.
According to Hatch, refusal to extend the tax cut would mean 24 times more farming estates paying the tax, 13 times more small businesses, and 15 times more estates.
More:
thenewamerican.com/economy/economics/ite...-estate-tax-increase 
