|Death Tax Repeal and Tax Update
from Catherine Treadwell Perry, J.D., Director of Government Relations
ASA Advocacy is part of the Family Business Coalition (FBC). We had our policy update last week where Congressman Jason Smith (R-MO) was in attendance, along with, Randy Gartin, House Ways and Means Committee Chief Tax Counsel, Marty Reiser, Policy Advisor, Minority Whip Scalise, Mark Warren, Senate Chief Tax Counsel, and Jim Neill, Policy Advisor, Senate Majority Leader McConnell. ASA is engaged in the FBC so we can track and monitor activities and proposed legislation that might have an impact our members operating family owned businesses.
Congressman Jason Smith (R-MO) sponsored the Death Tax Repeal Act and gave an update on the bill. This bill, which has 107 co-sponsors, would fully repeal the estate and generation-skipping transfer taxes. Although, the democrat co-sponsors for the bill has doubled since the last Congress, most democrats would like to use the Death Tax as a “pay for” for other pieces of legislation they are pushing. While the Tax Cuts and Jobs Act, which became law in December 2017, doubled the estate, gift, and generation-skipping tax exemptions, the “death tax” has not been fully eliminated. While the death tax provides only a tiny portion of federal revenue at less than one percent, it wreaks havoc on small businesses across the nation both through the administrative and therefore economic burdens it creates to comply even with an exemption but more so through the devastating impact it has on those subject to it and the economy they contribute to.
The House Ways and Means Committee has been busy! The mark up last week consisted of possible roll backs to the Tax Cuts and Jobs Acts and the Death Tax possibly being used as “pay fors” for traditional tax extenders. However, the tax extenders are always extended year to year without “pay fors.” This is very different than appropriations and the new Congress is having issues understanding that.
This markup may have helped kick start negotiation with the Senate, the current negotiations have not lead to any technical corrections that were in the TCJA from the previous Congress. In fact, the republicans would like to see an end to tax extenders, but the democrats will not budge on the issue because they are not in favor of the TCJA.
The Senate is dealing with another issue of the administration not being able to get their nominations affirmed. This has never happened before in history. However, the Senate Finance Committee is working to keep the TCJA intact and in place. The business community has done a great job in relating their stories to Congress of how the TCJA has helped them increase wage growth and investments. The Committee understand that there are technical corrections and drafting errors and they have a continued desire to do them, however, there is still not a bi-partisan effort to fix it. more
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