Estate Tax Fight Shifts To Senate

estate tax
Lawmakers and lobbyists pressing for an end to the federal estate tax hope newly elected Senate Republicans give them the votes they need to terminate what opponents of the levy call the "death tax."

Talks between Republicans and Democrats have just begun in the Senate, where some lawmakers have worried about increasing federal deficits. Estate tax repeal's top proponent, Sen. Jon Kyl, R-Ariz., refused to predict an outcome.

"We are working to see what the best approach is, and I'm not going to speculate," Kyl said.

Others signaled strong hopes that this year their fortunes have changed.

"We're very optimistic," said Ryan Peebles, senior manager of legislative affairs at the National Federation of Independent Business.

The House voted 272-162 on Wednesday to repeal the federal estate tax in 2010 and beyond. The legislation would prevent the estate tax from re-emerging after its scheduled elimination, for one year, in 2010. Previous bills passed by the House have languished in the Senate.

House lawmakers who voted to eliminate the tax said it burdens small businesses and farms, often forcing families to liquidate enterprises to cover the cost.

"We all realize that the government must have revenues and that taxes are a necessary evil," said House Speaker Dennis Hastert, R-Ill. "But this tax isn't necessary. It's just evil because it takes away the American dream from too many American families."

House Majority Leader Tom DeLay, R-Texas, called the levy "immoral" and the vote to terminate it a signal that Republicans had shifted the debate over taxes.

"We no longer ask how much we should raise taxes but how much we should cut them," he said.