The U.S. House has voted to repeal the federal estate tax. Congressman Peter Welch strongly opposed the plan because he says it will add $270 billion to the national deficit and benefit very few people.
The vote in the House was largely along party lines: Virtually all of the Republicans supported the bill, and almost all of the Democrats voted against it.
Under current law, individuals with estates valued at less than $5.4 million and couples with estates valued at less than $10.8 million are exempt from the federal estate tax. Estates above these amounts face a maximum federal tax of 40 percent.
The legislation would completely do away with the tax. The cost of the bill is projected to be roughly $270 billion over the next 10 years.
It's estimated that the tax repeal would affect roughly 5,500 estates annually throughout the country.
"It's important for Vermonters to understand that abolishing the estate tax at the federal level really wouldn't do anything for 99.9 percent of Vermonters,” says Welch, who strongly opposed the bill. “Any Vermont couple that has an estate less than $10.8 million does not pay a federal estate tax. So this law is not about Vermonters.”
"The thing that really troubles me is that we're focusing on adding $270 billion to the deficit when our roads and bridges need to be repaired, when our kids have got wicked high tuition costs." - Rep. Peter Welch
Welch says it's irresponsible to pass this legislation without identifying a specific way to pay for it.
"The thing that really troubles me is that we're focusing on adding $270 billion to the deficit when our roads and bridges need to be repaired, when our kids have got wicked high tuition costs … when the National Institute of Health budget is really being cut back,” he says. “So this is a bad idea."
The measure now goes to the Senate for its review. The White House has threatened to veto the legislation if the Senate endorses the House plan.
