Republicans are on the verge of a tax cut they’ve sought for decades, and it couldn’t fall more neatly into the “for the rich” narrative.
Repealing the federal tax on large estates is on the table for inclusion in the GOP’s reconciliation package, which they’re selling as a boon to farmers and small business owners. But they’re running into opposition, and not just from the blue corner.
Financial advisers the wealthy pay to keep down their taxes don’t want to see a lucrative revenue stream dry up, but that’s maybe saying the quiet part out loud. Industry group Finseca claims repealing the 40% tax wouldn’t survive long-term, and would lull the wealthy into a false sense of complacency in their estate planning.
Some 200 groups representing car dealers, farm interests, construction companies, funeral directors, plastics manufacturers, alcoholic beverage distributors, dude ranchers, and grocers disagree, and they’re lining up behind Senate Majority Leader John Thune, who says large ranches and other businesses back home in South Dakota may be worth more than the $28 million married couples can pass on tax-free.
He’s got 46 other Republicans on his side — including wealthy newbie Sens. Dave McCormick (Pa.), Bernie Moreno (Ohio), Jim Justice (W.Va.) and Tim Sheehy (Mont.) — all of whom supplanted Democrats.
Vice President JD Vance — whose job includes breaking tied Senate votes — co-sponsored the bill while a senator.
But the biggest hurdle for Republicans is math. Repealing it would cost the government $300 billion over the next decade, estimated Marc Goldwein of the Committee for a Responsible Federal Budget, versus extending the existing law — which at present, only covers 0.1% of Americans, according to the IRS. Read More
The idea still has to compete with others Trump pitched that would equal more savings for more Americans. And choosing offsets to cover those cuts is another topic for which we’ve got an update.
A big benefit of government work is the benefits, but one fed’s benefit is another Republican’s tax cut pay-for.
Federal health and retirement plans could be on the chopping block to help paper over the cost of Trump’s tax cuts. Public-sector unions are cobbling together a strategy to defend early retirement supplemental funding, pension payouts, and civil service protections, while benefits advisers say they’re experiencing high call volumes from workers contemplating retiring early or working later.
On the heels of Musk’s cuts to the federal workforce, benefits counselor Tammy Flanagan maybe inadvertently highlighted part of the point. “They’re kind of eroding what it means to be a federal worker,” she told labor reporter Austin Ramsey. “It seems like working in the federal government will be no different than working in the private sector.” Read More
