The incredible shrinking estate tax
So this remarkable statistic, from the Tax Policy Center at the Urban Institute and Brookings Institution in Washington D.C., is depressing:
"The estate tax is only a faint shadow of its former self. In 2009, less than one-quarter of one percent of deaths—just 5,500 decedents—will leave taxable estates, the smallest percentage since at least the Great Depression."
The rest of this short post explains what's behind this. And it's a measure of the distortions in the political debates in the United States that things have fallen so far:
"Opinion polls show significant numbers of voters saying they would more likely vote for a candidate who favors repeal. Maybe they all think they’ll win the lottery or their next great idea will become another Google. In the real world, we’re spending a lot of time worrying about a tax that fewer than three in a thousand of us will pay. And, when we do, we’ll be dead."
Not all wealthy people are against estate taxes: Warren Buffett is one of them, saying this in 2007:
“Tax law changes have benefited this group, including me, in a huge way. During that time the average American went exactly nowhere on the economic scale: he’s been on a treadmill while the superrich have been on a spaceship.”
Not all wealthy people are against high taxes, for that matter: this BBC story about wealthy Germans is interesting:
"A group of rich Germans has launched a petition calling for the government to make wealthy people pay higher taxes. The group say they have more money than they need, and the extra revenue could fund economic and social programmes to aid Germany's economic recovery. Germany could raise 100bn euros (£91bn) if the richest people paid a 5% wealth tax for two years, they say."