Reuters (7/14/10) has a report today on the efforts by senators Blanche Lincoln (D.-Arkansas) and Jon Kyl (R.-Arizona) to greatly reduce the amount wealthy estates owe in federal taxes. Under current law, after a one-year suspension, the federal estate tax rate will return to its pre-2001 level of 55 percent, with the first $1 million exempt. Lincoln and Kyl’s proposal would change the rate to 35 percent and exempt the first $5 million of an estate. This change would save millionaires $440 billion in its first decade, and add the same amount to the federal deficit.
How does Reuters report on this massive transfer of wealth to the rich? Under the headline “Two Senators Propose Reinstating Estate Tax,” reporter Kim Dixon begins her story, “Two senators, a Democrat and a Republican, have reintroduced a proposal to reinstate the estate tax, which lapsed this year amid a row among lawmakers over taxing the wealthy when they die.”
The story does go on to note what the rates would be under the Lincoln/Kyl proposal compared to current law, but leaves the budget-busting math as an exercise for the reader.