This was on the resolution or “rule” setting the terms for debating a bill that was designed to make the estate tax permanent and to reduce its impact on those who will be required to pay it. Supporters of the bill focused on the fact that, under its language, in 2011 the amount of an estate exempted from the tax would be increased to $3.5 million and the tax rate would be reduced to 45%. Opponents, who had supported the repeal of the estate in 2002, were against this bill because they claimed it would effectively reinstate that tax.
Rep. Polis (D-CO) was leading the support for the rule. He focused on what he said were the merits of the underlying bill for which the rule set the terms of debate. Polis argued that wealthy individuals “ like myself . . . with the financial resources to provide a high standard of living for our families, have a duty to our fellow Americans to pay our fair share. And an estate tax . . . is critical to prevent a permanent aristocracy from arising in this country.” Polis then cited a finding by The Urban-Brookings Tax Policy Center that only one out of 400 Americans would be subject to an estate tax.
Diaz-Balart (R-FL) was leading the opposition to the rule. He also focused his arguments on the underlying bill. Diaz-Balart said that “Americans who work hard and pay taxes all of their lives . . . should (not) be punished for responsibly saving with yet another tax when they pass away. He also criticized the estate tax because it would take capital out of the economy “(W)hen the country has double-digit unemployment . . . .” He focused particularly on what he claimed was the negative impact that “higher tax burdens” would have on “small businesses, the engines of economic growth and job creation in the nation . . . Small businesses are often struggling to survive, to meet payroll and avoid layoffs . . . .”
Rep. Foxx (R-NC), another opponent, said the bill will result in “the largest increase in the death tax in U.S. history . . . .” Other opponents said the tax was particularly unfair because it would be imposed on those Americans who had already paid the maximum rates on their wealth when the paid their income taxes.
Rep. Polis responded disputed the idea that many of those whose estates would be subject to the tax “have paid the highest tax rates throughout their lives. Many of the people who have accumulated great wealth in this country have, throughout their lives, paid the capital gains tax rather than the income tax rate . . . I'm the fourth-or fifth-wealthiest Member of this body (and) . . . I've paid the capital gains tax. That is a 15 percent tax . . . (a lower) percentage tax than members of my staff here in Congress that earn $50,000, $60,000 a year . . . .” Polis then cited the support for the measure from the two wealthiest Americans, Bill Gates and Warren Buffett.
Referring to the claim by Rep. Foxx that the bill would result in the biggest increase ever in the inheritance tax rate, Polis argued “this is a decrease . . . Instead of 55 percent and $1 million . . . (the bill) decreases the inheritance tax rate to 45 percent from 55 percent . . . .”
The rule setting the terms for debating the bill extending the estate tax was approved by a vote of 223-192. All two hundred and twenty-three “aye” votes were cast by Democrats. Twenty-one other Democrats joined one hundred and seventy-one Republicans and voted “nay”. As a result, the House was able to begin debating the bill extending the estate tax.