A House panel on Wednesday moved to repeal the estate tax, lowering taxes by $270 billion over 10 years.
The House Ways and Means Committee voted 22-10 Wednesday afternoon to send a bill repealing the tax to the House floor.
“People work hard and pay taxes all their lives. They’ve earned the right to leave something for their kids — often a family business — without being penalized for it,” Chairman Paul Ryan said at the committee Wednesday, claiming that the tax hits the “little guy.”
Democrats, including President Obama, have criticized Republicans for moving the bill this week, saying that repealing the so-called death tax would help only a few rich earners while the GOP budget under consideration on the House floor would cut government aid to others.
Rep. Sander Levin of Michigan, the top Democrat on the panel, drew attention Wednesday morning from an analysis finding that the repeal would cut taxes for fewer than 5,500 households. “This amounts to a massive tax cut for a tiny number of the wealthiest households,” Levin said.
The analysis of the measure, from Congress’ Joint Committee on Taxation, also found that repealing the 40 percent tax on estates over $5.25 million would reduce revenues by $269 billion over 10 years.
Republicans sought this week to highlight the negative effects of the tax on family business, including on minority-owned businesses.
While the White House and congressional leaders have said they are negotiating over a broader tax reform plan, Ryan’s committee has passed legislation that would make certain expired temporary tax breaks permanent and also on specific other tax changes. Those include an expansion of the college-savings accounts briefly targeted by the president’s budget proposal earlier in the year, and now the estate tax.
