PRESS RELEASE
-For Immediate Release-
December 17, 2010

Contact: Brian Gumm, (202) 683-4812, bgumm@ombwatch.org

OMB Watch Criticizes House Vote on Estate Tax Amendment

WASHINGTON, Dec. 17, 2010—OMB Watch today criticized the House's Dec. 16 failure to adopt Rep. Earl Pomeroy's (D-ND) estate tax amendment to the Bush tax cut compromise reached by President Obama and congressional Republicans. The vote against the Pomeroy amendment indicates that the nation's fiscal priorities have been cast aside in favor of the estate planning needs of the wealthiest 0.3 percent of Americans.

"Last night's vote is a finger in the eye of 99.7 percent of Americans," said Craig Jennings, Director of Federal Fiscal Policy at OMB Watch. "While our political leaders in Washington talk about how we can't afford health care for 9/11 rescue workers, they are handing out billions of dollars to those who can afford to buy hospitals."

Because the Senate and House concur that extremely wealthy Americans deserve further tax breaks, the estate tax parameters set forth in the tax cut and economic stimulus bill will add tens of billions of dollars to the federal budget deficit. Pomeroy's amendment would have adjusted the estate tax to exempt the first $3.5 million ($7 million for couples) of an estate and tax any amount above that at 45 percent – the same levels of the estate tax in effect in 2009. Should President Obama sign the bill, the first $5 million ($10 million for couples) will be passed on to heirs tax free, while the rest will be taxed at a generous rate of 35 percent.

A robust estate tax is important because it ensures that families who have benefited the most from the opportunities our nation provides pay their fair share to maintain those institutions that create opportunities for all. Similarly, a strong estate tax provides a check on the concentration of power in the hands of those born into great wealth while raising revenue that we need to invest in American infrastructure and our nation's people. Additionally, the estate tax provides incentives for charitable giving, helping to address problems in communities across the country.

Jennings said, "Now is a critical time to invest in Americans, as our country continues to struggle out of a deep recession. Yet advocates are told repeatedly that increased investments are not affordable because the federal deficit is too great." Jennings added, "A fair estate tax like the one proposed by Rep. Pomeroy could help meet those needs."

Jennings concluded, "Congress and President Obama have a duty to implement a fair tax system that responsibly funds the nation's fiscal priorities. OMB Watch urges both the legislative and executive branches to implement a robust estate tax that will help fund strengthened public protections, a stronger social safety net, and a growing economy."

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OMB Watch is a nonprofit research and advocacy organization dedicated to promoting government accountability, citizen participation in public policy decisions, and the use of fiscal and regulatory policy to serve the public interest. Find OMB Watch on Facebook and Twitter.