06/26/06 Estate Tax Compromise

Estate Tax Compromise. I'm Greg Martin with today's Line On Agriculture. The U.S. House of Representatives approved a compromise estate tax relief bill Thursday. The bill excludes five-million dollars per person and 10-million dollars per couple from the estate tax - called the death tax by its opponents. The measure is aimed at overcoming Senate opposition to permanent death tax repeal. And some political analysts believe the Senate could pass the compromise measure as soon as next week. But the compromise didn`t come without controversy. Indiana Republican Mike Pence said any tax that comes after death is immoral. PENCE: I believe it's also morally wrong to say to small business owners and family farmers and any Americans whatever their means after a lifetime of obeying the law and a lifetime of paying your share honestly and legally to the Federal Treasury that we'll make your death a taxable event. Washington Congressman Doc Hastings explains the death tax. HASTINGS: Under current law in 2011 the rate on the death tax will revert back to 55%. That makes it extremely hard for small businesses and farmers to plan what they would do with their property upon their demise. Georgia Republican Phil Gingrey said the compromise bill would bridge the gap between those who want permanent death tax repeal - and those who want the estate tax to return to its 2001 rate. GINGREY: It is a very strong compromise. It will protect many more families, small businesses, family farms from this double taxation or this so called death tax. It's my understanding Mr. Speaker that it also with a manager's amendment is index for inflation. Those of us of the conservative, fiscally conservative members of our side felt very strongly about that am I'm pleased with that addition. And even Pence argued that certainty about death tax rates - provided by the compromise bill - is preferable to not knowing what the death tax will be five years from now. PENCE: The estate tax relief provided in previous legislation is scheduled to end in 2010 and what we passed today will literally bring permanent estate tax relief to millions of American families, especially increasing the exemption to 5 million dollars per person effective January 1, 2010. The American Farm Bureau Federation hasn`t taken a position on the compromise. But in January - delegates to Farm Bureau`s annual convention agreed that an increase in the death tax exemption would be better than nothing at all. National Farmers Union has long supported reform - rather than complete estate tax repeal. That's today's Line On Agriculture. I'm Greg Martin on the Northwest Ag Information Network.