Though the so-called “death tax” is on life support these days, some of the candidates vying for a U.S. House seat in Maine’s 2nd District aren’t ready to give up on it.
Fifteen years ago, the federal government taxed more than 600 estates left behind by wealthy Mainers.
During the past five years, the number of Maine estates subject to the so-called “death tax” averaged 42, the consequence of revisions that have pushed ever higher the wealth someone must possess before the government grabs a share.
Put another way, that means the estate tax will apply to only about one in every 2,900 Mainers who dies.
For U.S. Rep. Bruce Poliquin, a 2nd District Republican in his second term, that’s still too many. He said recently he remains committed to abolishing the death tax. But the candidates jostling for the chance to run against him next year generally have a sharply different take.
“It makes me mad to think how this handout to just a few super wealthy trust funders who will never do a real day’s work in their life is saddling future generations of working men and women with an even greater national debt,” said Democrat Jared Golden, a state representative from Lewiston. “We will pay for this so the kids of millionaires and billionaires can buy another yacht to sail to a private island getaway.”
The issue is on the table in Washington this month because the House tax bill calls for axing the tax. The Senate measure opted instead to pare it again. It’s unclear which standard will prevail when a joint committee tries to reconcile the two measures into a single bill for final passage.
As it is, estates are not subject to federal tax unless they have more than $5.49 million for individuals or $10.98 million for married couples. Nationwide, that applies to about one in every 500 estates. The Senate proposal would double the exemption totals.
Poliquin said a couple of years ago that “it’s not fair for hardworking Maine families to start and grow their small businesses, and to pay taxes along the way, to find the IRS knocking on their doors to pay the despised death tax upon the passing of the senior family members.”
“These family-owned farms, fisheries, and wood products companies provide tens of thousands of jobs and better futures for our Maine families,” he said, adding that he is “proud to be part of the effort to repeal the destructive death tax and grow our economy.”
The challengers who’d like to take Poliquin’s place in the House next year have a different take.
Green Party hopeful Henry Bear said the estate tax “does not reward hardworking Mainers. It rewards the lucky.”
Bear said the nation should restore the 70 percent estate tax it had decades ago with a $1 million exemption. At that level, he said, the government could tax “a very small number of very lucky people” and raise $500 billion extra each year.
Democrat Jonathan Fulford said that “families of millionaires and billionaires, winners of the genetic lottery, who would overwhelmingly benefit from repealing the estate tax, don’t need another penny in tax breaks. Repealing the estate tax is a break for the rich that will be paid for by working families.”
Isleboro Democrat Craig Olson said he thinks the estate tax “should stand as written. Not that it is ideal, but I believe the only way to address the estate tax and other tax issues fairly is in a bipartisan manner in which we restructure the entire tax code and structure at the federal level through public hearings and legislation that allow as many voices as possible into the debate. “
“We cannot have real tax reform through legislation crafted behind closed doors with handwritten clarification and amendments not pertinent to taxation as we saw in last week’s bill passage strictly along party lines,” Olson said.
Lucas St. Clair, another Democratic challenger, said, “The whole tax reform is just bad, bad policy” that moves the country in the wrong direction.
“It’s bad for Maine. It’s bad for America. It will exacerbate the problem of income inequality,” St. Clair said.
Tiffany Bond, an independent, said the tax system needs an overhaul to bring consistency to the philosophy underlying it. In the meantime, though, she doesn’t think it’s a good idea to change the estate tax or rewrite the tax code “without having a thoughtful, solid baseline for how we tax our citizens and businesses that passes a bipartisan sniff test.”
IRS data show a sharp drop in the number of Mainers paying the estate tax.