Over the last week, Capitol Hill has been abuzz with speculation that House and Senate GOP leaders were engaging in a last-ditch effort to attach a provision gutting the estate tax to a sensitive and complicated pension reform conference report. The sneaky move failed, however, as Senate Majority Leader Bill First (R-TN) announced today he could not convince a number of key Republicans, particularly Sen. Olympia Snowe (R-ME), to support it. In related news, President Bush has moved to gut IRS estate tax enforcement. Early this week, Senate and House leaders and conferees to the pensions bill were still trying to negotiate a compromise that would include estate tax "reform," no easy task as all seven Democratic members of the conference committee openly expressed opposition estate tax language being included in the bill. In addition, three Republican members of the conference committee - Snowe, Charles Grassley (R-IA) and Michael Enzi (R-WY) - expressed strong reservations about including an unrelated estate tax provision costing almost $300 billion. Frist led the desperate effort to pass any reduction in the estate tax. Earlier this year, he convinced House Chairman of the House Ways and Means Committee Bill Thomas (R-CA) to pass a stand-alone "compromise bill" on the estate tax. When Frist could not secure the votes to bring the House bill up on its own, he began to look elsewhere. Realizing the pensions bill will almost certainly be the last tax bill of the 109th Congress, Frist pushed hard to enact one last enormous tax giveaway to the richest Americans. The move was rejected, however, for the very reason Frist sought to attach it to the pension reform bill: the bill was too important to risk losing consensus., The House and Senate have been negotiating for months to iron out differences in a broad overhaul of laws regulating the way private companies fund their employee pension plans. Even without adding the estate tax issue, the compromise remains tenuous at best. This fragile balance appears to have been a contributing factor to resistance from Republicans on the conference committee. If the estate tax language had been inserted and the seven Democrats withheld their signatures from the conference report as expected, all nine Republicans would have needed to endorse the report, in order for it to move to the floor for consideration and final passage. With three Republican Senators repeatedly expressing their reservations, including anything related to the estate tax would have almost certainly proven too difficult. Many observers saw Snowe as holding the key to the GOP votes on the conference committee. Over the years, Snowe, the senior senator from Maine, has often found herself at the center of resistance to radical tax cut plans, particularly the recently passed capital gains and dividend tax cuts, as well as the total size of the 2003 tax cuts. Once again, she has been able to exert considerable influence against additional tax cuts for the very wealthiest Americans at the expense of working families. With little time left and far too much to do, it is unlikely that the Senate will return to the issue this year. Yet even as this latest attempt to gut the estate tax failed, some in Congress are vowing to hold a popular package of tax cuts that was supposed to be included in the pensions bill over until September in order to attach the estate tax reform to it and take one more shot before the elections. Administration Pulls Out All the Stops to Render Estate Tax Meaningless While it appears that Congress has failed to repeal or slash the estate tax, the Bush administration is shifting tactics and moving to eliminate the need for wealthy citizens to comply with the estate tax. The New York Times reported over the weekend that the IRS is planning to eliminate 157 attorneys working in the estate and gift tax division - nearly half of the staff at the IRS who audit tax returns of the country's richest citizens. According to six estate tax attorneys who leaked the plans to the Times, the reductions are part of a continuing effort to "shield people with political connections and complex tax-avoidance devices from thorough audits." The White House decision seems particularly suspect as both the IRS and the Treasury Department have recently reported to Congress that tax cheating and avoidance by high-income Americans is a significant and growing problem. The country had an annual tax gap - which is the difference between the taxes owed by Americans and the taxes collected by the government - for 2005 in excess of $350 billion.