RE: Don't repeal the estate tax!

Dear Senator ,

I very strongly urge you to oppose all proposals to either permanently repeal the estate tax or "reform" it in ways that render it meaningless.

Repeal of the estate tax would drastically reduce federal revenues that are needed to meet critical challenges and curb record deficits. Full repeal would cost nearly $1 trillion during the first ten years (2012 to 2021), adding to deficits that are already at record levels. Programs for vulnerable populations are already being cut, and the nation is facing the growing fiscal challenges that come with an aging population, rising health care costs, unmet education needs, Social Security insolvency, and homeland security. It will be much more difficult to meet these challenges if the estate tax is repealed.

We cannot afford another costly tax cut that benefits only the wealthiest few, as estate tax repeal would. Currently, only estates larger than $1.5 million for an individual ($3 million for a couple) are subject to the estate tax and that level is set to rise to $3.5 million ($7 million for a couple) by 2009. Only about one percent of estates currently pay any estate tax at all. The estate tax is the most progressive part of the overall tax system; its repeal or drastic reduction will shift the tax burden to middle class and working Americans. Repeal of the tax runs counter to core American values of fairness.

Repeal of the estate tax would also reduce charitable giving. Recent studies, such as one from the Congressional Budget Office, show that if the estate tax had been repealed in 2000, U.S. charities would have lost $13 to $25 billion in donations per year. Adjusting for inflation, these figures could be even higher in 2009 and the years following. This revenue cannot be replaced by charities and the effect of such losses on organizations receiving support from bequests and foundations -- an enormous variety of organizations from soup kitchens to universities -- will be debilitating.

Some proposals to "reform" the estate tax are simply a back door means by which to repeal it. For example, a proposal to exempt the first $10 million ($20 million for a couple) of an estate from any taxation and to tax the remainder at 15 percent, the current capital gains rate, is unacceptable. It is little more than a fig leaf disguising permanent repeal and is irresponsible both in terms of fiscal impact and policy direction.

At a time when our country is struggling to curb the growth of record-high deficits and when we are debating deep cuts in assistance for the nation�s most vulnerable populations, the last thing we need is yet another irresponsible tax cut for the very wealthiest Americans. We urge you to vote for fiscal discipline, fairness, and compassion; and to vote against both permanent repeal of the estate tax as well as irresponsible reform proposals that would lose nearly as much revenue and cost charitable organizations billions of dollars annually.

Most Sincerely,

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