The sponsors of the new Billionaires Pay Zero Tax Act don’t mention, of course, their billionaire patrons in their advocacy. They refer instead to all the “family-run farms, ranches, and businesses” upon which the estate tax would “wreak havoc.” What they don’t say: Only 50 farms and businesses in the entire country likely would have been subject to estate tax in 2017, according to Center on Budget and Policy Priorities research. And the Center did that research before lawmakers in Congress doubled the exemption from estate tax in the 2018 Tax Cuts and Jobs Act.
The Billionaires Pay Zero Tax Act sponsors also don’t mention that our U.S. tax code already has provisions that protect the very few families with farms and businesses subject to estate tax. If the bill sponsors truly cared about family farms, ranches, and businesses, they could have proposed legislation to expand these protections but leave the estate tax intact.
These lawmakers might have proposed, for instance, a lengthening of the 15-year period the inheritors of family farms, ranches, and businesses currently have to pay their estate tax due. Or they might have proposed an expansion in the “special use” provisions that allow estates to value farm property according to its use as a farm, rather than at its market value. A bill taking that approach likely would have drawn bipartisan support and actually had a chance of becoming law in this Congress.
Why have Republicans purporting to be concerned about family farms, ranches, and businesses rejected this extending-protections approach and instead introduced a bill whose benefits will flow overwhelmingly to the ultra-rich?
Here’s my guess: The actual intended beneficiaries of the bill don’t happen to be family-owned farms, ranches, and businesses. But GOP lawmakers know full well that saying you don’t think billionaires should have to pay any tax at all, ever, doesn’t make for good messaging.
Saying that would be like naming your bill the “Billionaires Pay Zero Tax Act.”
Veteran tax attorney Bob Lord, an Institute for Policy Studies associate fellow, is currently serving as a senior advisor on tax policy for Patriotic Millionaires.