Director of Federal Fiscal Policy
The Senate-passed tax bill would double the value of estates that’s exempt from the estate tax, from $11 million per couple ($5.5 million per person) to $22 million per couple ($11 million per person). And, as explained below, Senate Finance Committee Republican Charles Grassley recently used an ill-advised argument to call for repealing the tax entirely. Here’s why both weakening and repealing the tax are bad ideas.
Doubling the estate tax exemption until the end of 2025 (as the Senate-passed bill would do) would cost $83 billion over ten years – more than the cost of a proposal from Senate Republicans Marco Rubio and Mike Lee that would expand the Child Tax Credit and help 26 million children in low-income working families.
A number of Senate Republicans, including Senate Finance Committee Chairman Orrin Hatch, Susan Collins, Mike Rounds, and Jeff Flake, have said that repealing the estate tax — as the House-passed tax bill would eventually do — isn’t a high priority. They’re right, especially given the nation’s growing fiscal challenges and wealth inequality. But neither is giving heirs of the wealthiest estates a huge tax cut by doubling the estate tax exemption.