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Estate Tax Hike Is Likely: 35% to 55%

Written by Gary North on August 2, 2012

President Bus’s tax cuts involved a cut in the estate tax from 55% to 35%. That will expire on January 1. Rich people who want a better deal for their heirs had better expire before January 1.

Class warfare is the basis of this tax. So is jealously. The poor and especially the middle class — which has the votes — want to stick it to the rich. They want their children to inherit without paying much tax, but not the rich. It’s different strokes for different folks.

The test of a society’s commitment to the rule of law is flat taxation. The sales tax is flat taxation. So is the gasoline tax. They do not discriminate based on income. They uphold the idea that voting groups are not supposed to use force to steal from other groups.

The estate tax is popular in the West. The middle class pretends that it favors equal taxation, but it doesn’t.

What is the result? The poor pay no income taxes, and the middle class does. I find this amusing.

“How did that happen?” This is the cry of every theft-driven voting bloc when it finds that its members are the targets of some larger voting group. When passing discriminatory taxes, middle-class voters think, “Thus far, and no farther.” It never works, of course.

If a deal to extend the Bush tax cuts is hammered out before January 1, it is unlikely that the estate tax hike will be rolled back. Obama will veto the bill if it the cut is included.

The estate tax is mostly symbolic. It collects little revenue: under 2% of federal revenues. Very rich families create tax-exempt foundations and place their children on the boards of these foundations. The super-rich figured out this strategy a century ago. It works. Estate tax planning lawyers and CPAs rely on this as a source of income.

The tax says: “We have the right to tax you at a rate higher than we tax ourselves. Get used to it.” It is an assertion of class power. Middle-class Americans will not rise up in fury to retain the 35% top bracket. But they should. That would send a message to the Democrats, who say they represent the poor: “We believe in the rule of law.” But they don’t.

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12 thoughts on “Estate Tax Hike Is Likely: 35% to 55%

  1. Avery Mac says:

    The progressive income tax is tantamount to a progressive penal code where one class gets a "warning" for pre-meditated murder and another class get the death penalty for speeding. The progressive tax system is completely discriminatory and morally reprehensible. What ever happened to the idea of equal treatment under the law? With democRATS some are MORE EQUAL than others.

  2. I'm a %10er. No IRS. A tax at the cash register. Nothing else. You pay your agent %10, tithe %10 but Uncle Sam unconstitutionally takes half the wealth of the nation. It %10 enough for God it's enough for Uncle Sam. Limited Government means you limit the taxes to an appropriate amount. America would thrive. We've gotten used to being stolen from, time to end it.
    Check out my kids. http://www.youtube.com/watch?v=vAFrf59KDFY&fe

    Wish I had something other than talent to leave them!

  3. I do believe I am one of the poor to middle class. Just cause someone is rich I do not think they should pay more than me Period. They worked hard and their familys should reap the rewards if that is their last wishes. God Bless them, they hire people like me. I have never been hired by a poor person. Dumbass Government.

  4. you wrote my comment for me three hours before i got here

  5. Everyone paid taxes on what they owned through out their life. They saved their money and didn't squandered what they have. So why should the government pentilize the benifactors? The government tried to take it from them all thier lives.

  6. The government didn't build the nest egg!!!

  7. Barrack Obama is going to confiscate what belongs to We the People and much of that is going to end up in his pocket the very same way that all of the other Dictators around the world have taken from not jest the rich but if they want it they take it from even the poor. The Obama supporters are in for a very big surprise when he comes after what they have and when he is now saying he wants to take from the rich and give to the poor. Well he is talking about himself only but as every con man does he has the masses fooled and they are going to let him walk right in the front door of our homes and take what he wants and these fools will not protest but if anyone does then they will regret ever saying anything. People you had better get your heads out of your stupid as# before it is to late and if you don't think it is going to happen you are much dumber than I thought.

  8. If you want the estate tax to go back to 55%, then vote for the dictator!!! He needs the money to continue his marxist agenda of taking everything away from all of us so we will be under the total control of the government….HIS government!!! When will people realize what's happening here??????????? Are they all just so ignorant they believe everything he says????? It's really hard to believe people are so stupid to vote for the dictator….I guess he has them under his control with food stamps and welfare!!! No incentive or initiative left in these people or any self-esteem!!! Too bad……for the rest of us, that is!!!

  9. Marcia Kelso says:

    You have no idea what you are talking about, and the abolish the IRS, pro-greed, rapacious, Republican crowd also claim to be "born-again Christians?" You people are a bunch of Rush Limbaugh ditto heads that have been brainwashed about how you have no responsibilty for the poor, the needy and the disadvantaged. I just hope the IRS wakes up and audits you tax cheats!!!

  10. Chemiker says:

    I am the owner of a small business. Were it not for rich clients, I would be in serious financial trouble. Your are correct. The poor do not creat jobs.

  11. Chemiker says:

    When the inheritance tax is high, many small businesses are forced out of business when the owner dies. What then happens to the employees? This is very common, and rarely mentioned as an unintended (?) consequence of high inheritance taxes.

    I have read that Buffett, Obama's dear friend, acquired a number of businesses at fire sale prices when the IRS came calling on the heirs.

  12. Chrstian Patriot says:

    Jesus said care for the widows and the children…And he also said a lazy man shall not eat!! So who is the brainwashed one….and Jesus also says do charity out of your heart and in private, do not boast about it!! He also says "thou shalt not STEAL" which is exactly what the Government is doing to us tax paying citizens!! It's not greed lady, it's keeping and doing what is right in the way we see fit with our EARNINGS….!!! Ugh SMH!!