Currently, individuals are exempt from the estate tax if their assets are less than $5.43 million, while the limit for married couples is $10.86 million, with the top tax rate on income above those levels being 40 percent.
A nearly identical version of this bill was introduced in June 2013, but failed to receive a vote in the House before the end of the 113th Congress.
Former Director of the Congressional Budget Office (CBO) Douglas Holtz-Eakin, produced a study in 2009 that estimated a repeal of the estate tax would lead to the creation of 1.5 million jobs, reduce the 2009 unemployment rate by nearly a full percentage point, and increase the amount of capital available to small business by over $1.6 trillion.
Farms are particularly likely to being hit hard by the estate tax, as a 1999 study by the CBO found that 12 percent of farms had estate tax bills that exceeded their liquid assets.
Senate Majority Leader Mitch McConnell (R-KY) has said of the estate tax that:
“It is the federal government’s final insult to tax your family when you have already paid taxes on your property throughout your life. The thought of having to visit the IRS and the undertaker on the same day is an absolute outrage.”
Proponents of the estate tax believe that it fairly taxes the richest Americans, with some pointing out that only 2 out of every 1000 estates face the estate tax. They also note that the effective estate tax rate is actually closer to 17 percent than the 40 percent marginal rate. A writer for the Washington Post referred to the proposal as a “$246 billion gift to the Paris Hiltons of the world over the next decade.”