President Trump claims eliminating the estate tax would lift a burden on many family businesses and farms.
"To protect millions of small businesses and the American farmer, we are finally ending the crushing, the horrible, the unfair estate tax, or as it is often referred to, the death tax," Trump said in a Sept. 27 speech.
But Trump's claim about "millions of small businesses" being ruined by the tax was rated "Pants on Fire" by Politifact. You have to be worth more than $5.49 million to even to file an estate tax return, and the number of people who end up paying it is vanishingly small.
Only 5,460 estates even pay the tax each year, according to a credible estimate, and of those, about 80 represented small businesses or farms.
Here's the thing: we actually need the money the estate tax generates from that tiny group of people.
At the Wall Street Journal, Michael J. Graetz argues the estate tax is an inheritance tax that is absolutely fair, and our country needs that revenue. The American system enabled the superrich to create their wealth in the first place—there's nothing wrong with requiring them to give back.
Is it fair for Paris Hilton to inherit her great-grandfather Conrad's fortune without paying any tax on it? Or Yankee owner George Steinbrenner's 13 grandchildren? This is exactly what happens when there is no estate or inheritance tax on the bequests of the very rich.Indeed, that's what the case for the estate tax boils down to: basic fairness. The tax affects a small number of people who inherit large amounts of wealth—and who can afford to give up a portion of their windfall to help finance their government.
But others say it's just immoral. Even if people have millions of dollars, they should be allowed to leave that money to their children.
Inheritance tax is so immoral. Someone's worked all their life for something paying tax and then to be taxed again for it once they die.