For a country that is so focused on making money, this seems to be something that the US isn’t paying close enough attention to. From the article, it seems as though the estate and inheritance tax in the US, is the fourth highest in the world, but is only bringing in less than 1% of the federal revenue. At one point, the US even eliminated it for an entire year, but brought it back for whatever reason.
I am uncertain of the technicalities of the way the tax works, but I would be willing to wager that they are meant to help the rich and not help the middle or lower classes. I could be wrong, but history isn’t in the governments favor on this.
However, from the research done for this article, there is evidence that eliminating the tax altogether could even help the economy. While I am not sure exactly how that would work, it does seem like something that the government should spend a few minutes looking into.
Table 3. The Effect of Estate Tax Elimination
|Economic and Revenue Change Estimates for Estate Tax Elimination vs. Current Law Projection (Billions of 2015 Dollars)|
|Change in Level of GDP||0.8%|
|GDP Change in Terms of Today’s Economy||$137|
|Change in Private Business GDP||0.8%|
|Change in Private Business Stocks (Machines, Equipment, Structures, etc.)||2.2%|
|Change in Wage Rate||0.7%|
|Change in Private Business Hours of Work||0.1%|
|Full-time Equivalent Jobs (in Thousands)||139|
|Annual Static Federal Revenue Estimate in Steady State||-$20|
|Annual Dynamic Federal Revenue Estimate after GDP Gain or Loss||$8|
|Source: Tax Foundation Taxes and Growth Model.|
While there are 13 countries that have repealed this law, I am not sure that the list of countries itself is necessarily one that supports the idea that we should abandon the tax ourselves. I do think that looking at the changes in economic growth or failure since the time that they repealed it, is definitely worth looking at more closely.
Table 2. Thirteen Countries or Tax Jurisdictions Have Repealed Inheritance or Estate Taxes Since 2000
|Country or Jurisdiction||Year of Repeal|
|Source: Family Business Coalition.|