CBPP Calls Foul on Recent Estate Tax *Studies*
by Gary Therkildsen*
Jul 8, 2009
The Center on Budget and Policy Priorities (CBPP), a non-profit fiscal policy institute, released a report yesterday questioning the accuracy of two recent reports from the American Family Business Foundation (AFBF) that claim repeal of the federal estate tax could create upward of 1 million jobs relatively cost free.
The Center on Budget and Policy Priorities called the claims "seriously flawed" and maintained that "Despite questionable reports to the contrary, repealing the estate tax would weaken the economy by adding nearly $800 billion to budget deficits over 10 years...leaving fewer funds for investment that leads to higher productivity in the long run." The CBPP report also cited an Urban Institute-Brookings Institution Tax Policy Center description of one of the AFBF reports, coauthored by Douglas Holtz-Eakin, former Congressional Budget Office director, McCain presidential campaign advisor, and overall strumpet for wealthy persons' causes, as "[getting] the economics all wrong" and "[relying] on back-of-the-envelope analysis rather than empirical data."
We have seen this before. Groups like AFBF have tried to scare people with claims that the "death tax" is going to rob them of their life savings when they die, or that the estate tax kills family farms and small businesses. Of course, only a small percentage of the population has to pay estate taxes and very few farms or small businesses are affected either, but that does not stop people like Mr. Holtz-Eakin from arguing otherwise. Congress is going to tackle estate tax reform this legislative session and it seems AFBF, "a group funded by wealthy families that stand to receive large windfalls if Congress repeals the estate tax," is trying to get out in front and influence the debate in a less than honest way again. The Center on Budget and Policy Priorities simply took them to task for it.
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