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Collins criticizes
Democrats on 'death tax' override failure
U.S. Rep. Mac Collins, who
represents Fayette and nine other Georgia counties, this week decried
he failure of Congress to override a presidential veto on repeal of the
so-called death tax.
"When members of President Clinton's party voted to sustain his veto
of the death tax, they voted to subject family farms and businesses to
ruinous estate taxes," Collins said following the vote.
Collins joined 274 Republicans and Democrats who voted to override Clinton's
veto, but fell approximately 10 votes shy of the two-thirds necessary
for an override. "This vote was disappointing, but we will be back
with relief for those who don't want to see their life's work go to the
IRS instead of their children," Collins said.
He cited a study of previously successful small businesses that failed
after the death of the owner, saying the study showed lack of capital
was responsible in 75 percent of the cases. Of these, 70 percent failed
because the effort to raise the cash to pay the estate tax strangled the
business, he said.
"The death tax is unfair, because it is double taxation," Collins
said. "You are taxed all your life on what you earn, but when you
want to hand it down to your children, the federal government takes a
second bite, which can amount to 55 percent. This heavy tax bill kills
many farms and small businesses. "Since
small business is this nation's major job creator, it makes sense to end
a tax policy that kills these businesses," Collins added. "We
worked long and hard to repeal this unfair tax. It is very unfortunate
that partisan politics won over the preservation of family farms and businesses."
The bill would have phased in a repeal of estate, gift, and generation-skipping
taxes. Prior to full repeal in 2010, the estate and gift tax rates would
be reduced as follows: in 2001, the 55 percent tax rate and the 5 percent
surtax would be repealed; in 2002 the highest rate would be 50 percent.
Each of these rates would be reduced by one percentage point per year
from 2003 through 2006, 1.5 percentage points in 2007, and two percentage
points in 2008 and 2009.
No rate would be reduced below the lowest general individual income tax
rate for unmarried individuals and the highest rate would not be reduced
below the highest general individual income tax rate for unmarried individuals.
Additionally, state estate tax credit rates would be reduced in proportion
to the federal estate and gift tax rate reductions.
"New death tax relief may simply raise the exclusion amount, and
lower the tax rates of those estates which still face taxes," Collins
explained, adding, "Any full repeal will have to wait for a new occupant
in the White House."
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