WASHINGTON – The U.S. Senate voted 54-44 last Wednesday to defeat an amendment by Republican Senators Phil Gramm and Jon Kyl that would have permanently repealed the death tax.
Under Senate budget rules, 60 votes were required for passage of the amendment. The vote was split down party lines, with nine Democrats and 45 Republicans voting for the permanent repeal, and 41 Democrats and two Republicans and one Independent voting against.
Ohio Senators George Voinovich and Mike DeWine voted for the permanent repeal, as did Pennsylvania’s two senators, Rick Santorum and Arlen Specter.
The House passed legislation to eliminate the death tax June 6, with a 256-171 vote.
Dead issue. Observers speculate the death tax repeal is a dead issue this year, as it is unlikely that the Senate Majority Leader will allow another vote on the Gramm-Kyl amendment this year prior to the adjournment of the 107th Congress.
Under last year’s tax bill, estate taxes are slowly phased out by 2010. A sunset clause on the tax cut, however, will revert the estate tax back to 2001 levels in 2011 – unless Congress passes new legislation to repeal the taxes permanently.
Can’t tax death. “The Democratic alternatives do not repeal this cruel tax,” said Kyl prior to the vote. “Their so-called reforms merely pick and choose who is exempted from this tax, and who is not. You cannot mend something that works so fundamentally against American values. Death should not be a taxable event.”
Senators voting against permanent death tax repeal, Kyl said, are “voting in favor of reimposing as much as $100 billion in new taxes on American families in 2011.”
Gramm has a track record of opposing the death tax, so he was a natural to present the amendment.
“It’s not right to make people break up their family business or family farm to pay taxes just because the person who built it died,” Gramm said in an earlier statement. “this bill is not a question of money. It’s a question of right or wrong.”
The Democrats offered two alternatives, but both fell short of the 60 votes needed.
Farmers just pawns. Sen. Paul Wellstone, D-Minn., who serves on both the Senate Small Business and Agriculture committees, differed with the Republican sponsors. “Small businesses and farmers are the pawns in this debate,” Wellstone said on the Senate floor. “They have literally been used by those who want to give billionaires a tax break.
“I don’t know if there is a single person in this body who would oppose giving permanent, targeted estate tax relief to small business owners and family farmers.”
Wellstone said the supporters’ real agenda is to get repeals for billionaires, too. “They aren’t going to let the little guy on Main Street get his tax break unless they can get it for the fat cat on Wall Street.”
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