The Instigator
dan
Pro (for)
Losing
3 Points
The Contender
IronHead60
Con (against)
Winning
28 Points

The estate tax should be eliminated.

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Voting Style: Open Point System: 7 Point
Started: 12/26/2007 Category: Politics
Updated: 9 years ago Status: Voting Period
Viewed: 2,665 times Debate No: 1010
Debate Rounds (3)
Comments (5)
Votes (11)

 

dan

Pro

The estate tax is a tax imposed on property which is transferred to another upon the said person becoming deceased. However, this tax should be eliminated from the American government which is in place to simply make the government richer.

As stated by presidential candidate Mitt Romney, people are taxed too often, when they make money, when the invest money, and when they pass the money on upon their death. I am not arguing the significance of the entire tax system in our government; however, anything in excess is a bad thing. I feel that Americans are being taken advantage of in the amount of taxes they are required to pay. Too often, taxes have become a major issue in the day to day activities of the American public.

The government has a right to tax its citizens because without tax, there would be no funding, and without funding, the mere idea of government simply cannot be effective. The American people need a break from being forced to continually fund the American government, even up until the day that they die, literally. If the government can afford to fund a billion dollar war in Iraq as well as continually funding welfare programs across the nation, then it is obvious that, with proper cuts in unnecessary spending, the estate tax will not be missed if removed.

With the hundreds of different forms of taxation that exists, one may wonder why the estate tax should be removed verse's other taxes such as sales tax, income tax, etc. However, the ease and significance of removing the estate tax is paramount. The estate tax is simple: the value of ones said goods is estimated, and a percentage of that estate must be paid to the government. Since the estate is an "extra" value to one receiving the goods, the tax is not often missed and causes little controversy. However, the belief that America can afford to loose a tax is major and clearly evident across the nation. The political impact that removing this tax can do for a politician is significant. Taxes need to be lowered in this nation, and a good first step is the removal of the estate tax.
IronHead60

Con

Greetings, everyone. This is my first post on debate.org (other than a few comment responses), so hopefully this one goes well.

Dan, I'm a fan of brevity. If we can keep our arguments concise and to the point, I think that might bode well for one another and the online community. I'm going to keep my arguments around 4,000 characters. Please feel free to debate as you like, of course.

INTRODUCTION

If I can sum up your argument, it appears as though you are against the estate tax for two reasons. First, it is a burden on the American taxpayer. Second, it is a superfluous form of income collected by the federal government. As I will show, neither of these claims are correct. Once these assertions are disproved through factual evidence, followed by a benefits explanation of the estate tax in the same regard, the only logical conclusion will be to favor it instead.

BURDEN ON THE TAXPAYER

The estate tax, as you've defined, is essentially correct (though "property" is a loose word). Additionally, most reasonable people would agree with your point that too much taxation on the American public is a bad thing. However, your interchangeable use of the words "American(s)" and "American public" in your argument imply *all* Americans, when you actually should describe "affluent Americans."

The estate tax presently affects only those estates of considerable size - over $2M for individuals and over $4M for couples (http://www.irs.gov...). Since the majority of Americans do not own such estates, it is unfair and inaccurate to imply that all Americans are being burdened by the estate tax when in fact, it is only a very small percentage. The majority of Americans do not feel this burden whatsoever.

SUPERFLUOUS FORM OF INCOME

You claim that the estate tax will not be missed [by the government] if removed and further, that America (the nation and its people) can afford to lose it. This argument is incorrect for two reasons.

1. There is a wealth of evidence indicating that the repeal of the wealth tax would cost over $1T (yes, trillion) over the first ten years of implementation (Center on Budget and Policy Priorities, March 16, 2005). This revenue loss of full repeal would dwarf the total amount we currently spend annually on homeland security ($38 billion), K-12 education ($36 billion), health care for veterans ($29 billion), and student financial assistance ($14 billion) (Budget of the United States Government, Fiscal Year 2006, Historical Tables). It is many times the size of all cuts to entitlement programs combined in the 2006 federal budget ($35 billion over 5 years) (Robert Greenstein, "The Tough Fiscal Challenges that Lie Ahead," Center on Budget and Policy Priorities).

2. If we were to opt for spending cuts and other tax measures to curtail the $1T loss instead, the results would also be unfortunate and certainly missed by Americans. Setting aside the nation's need for things like greater health care coverage and education which would suffer greatly via spending cuts, this regressive tax cut would shift a greater share of taxes onto the middle class, while benefiting only the small percentage of America, specifically the most affluent individuals.

ESTATE TAX BENEFITS

The benefits of an estate tax are many, but for the purposes of being succinct, I will list two:

1. Promotes charitable giving - According to a 2004 Congressional Budget Office (CBO) report, charities received between $13 billion and $25 billion in additional donations in 2000 because of the estate tax.

2. Strengthens our nation's fiscal health and the programs needed to support it in order to be effective (ironically, you note that this point is also important).

CONCLUSION

The evidence clearly indicates that the estate tax is neither a burden on most Americans nor something that can treated superfluously. The estate tax is a significant form of income to this nation and benefits many at the expense of few. In fact, not only is the estate tax a good thing, but it also reinforces our values of fairness and our belief in a meritocracy - individuals should not have economic power as a sole consequence of an "accident of birth." In the words of President Franklin D. Roosevelt, "Such inherited economic power is as inconsistent with the ideals of this generation as inherited political power was inconsistent with the ideals of the generation which established our government."
Debate Round No. 1
dan

Pro

dan forfeited this round.
IronHead60

Con

I will make no further arguments since my opponent has faied to respond. Dan, I'm giving you the benefit of the doubt that due to the holidays and everything, perhaps it's difficult to make a timely post.

Hope you can at least show up for round three. Otherwise, it may be difficult for you to win the debate.
Debate Round No. 2
dan

Pro

dan forfeited this round.
IronHead60

Con

Unfortunately, my opponent has failed to post a response past his original piece. I've illustrated my points while discrediting my opponent's. Thank you for your votes. Hopefully my second debate will be better than this one!

Happy new year, everyone!
Debate Round No. 3
5 comments have been posted on this debate. Showing 1 through 5 records.
Posted by IronHead60 9 years ago
IronHead60
You're welcome, MJ. I enjoy the intellectual discussion.

Not a major issue by any means, but I would contend that on a private level, individuals want utility. On the business level, you're right; businesses want money. Kind of cool... never thought about the dual-perspective.

As for your second point, I'm not an expert on this subject, but intellectually, I would argue the following relationship between charitable donations and the estate tax (from start to finish):

1. Estate tax is imposed.
2. Wealthy learns that, upon death, their estate will be taxed once it's transferred.

3. Wealthy has new incentives to reasonably reduce the size of their estate, thereby minimizing the taxable amount given to the government.

4. Wealthy has several options to reduce the size of their estate - consume, give to family/friends, give to charity, etc. The latter is predominantly selected since they can be claimed as tax deductions within a year, thereby increasing their marginal propensity to consume.

5. Charitable contributions, as a result of the estate tax, increase.

As mentioned previously, this relationship has been confirmed with empirical data from several sources. To answer your question specifically though, I have to imagine that most people would pass along their estate to family and friends vs. individuals and groups that they are unfamiliar with. Perhaps it's a subconscious feeling to sustain the bloodline, or offer your family members more opportunity than you had? But really, who knows? I'm sure some would give to charity, while others wouldn't. (Have you considered submitting this question to estate tax think tanks?)

But I think the larger issue still stands, which is about a meritocracy. Most Americans don't believe in "accidents of birth." If you believe that to be true, then an incentive system (the estate tax) that prevents such a thing from happening is a good thing and should be preserved.
Posted by mjvoss 9 years ago
mjvoss
Ironhead, thank you for the thoughtful response.

1) Although you are correct that "utility" is truly what everyone wants, this does translate into money, especially in regards to businesses.

2) Also, I never said that your charity point was refutable. I wanted to know why exactly charity-giving went up as a result of estate tax. You don't think that if more money were given back to those people that they would give to charity?
Posted by IronHead60 9 years ago
IronHead60
Thanks, everyone. Glad you enjoyed the "debate."

Some responses:

1. The $1T dollar amount is actually a figure that has support from several well-respected organizations - Center for Budget and Policy Priorities, the Brookings Institute, and the (bi-partisan) Joint Committee on Taxation. To be clear of course, it assumes both lost tax revenue and increased debt interest repayment over the years 2012-2021, the first ten years in which any repeal of the estate tax would occur.

So respectfully, I'm still not convinced that this $1T is an inaccurate amount.

2. Irrefutably, the dream of every American (and person) should be "the pursuit of happiness (or utility)" *not* money (money does not buy happiness). Proponents of repealing the estate tax should keep this in mind for *everyone* in the system. Reasonable people would also agree on this point - doing something that benefits many at the expense of few is often a good thing.

With this in mind, let's talk economics. On a micro-scale, the estate tax provides natural incentives for the very wealthy to give to charities. This point is also irrefutable. In fact, according to a 2004 Congressional Budget Office (CBO) report, charities received between $13 billion and $25 billion in additional donations in 2000 because of the estate tax. These numbers only increase at present day. That's significant.

On a macro-scale, it's unfair to say what the wealthy would do if there were no estate tax. Some would save more. Others would not. We don't know the effect on private savings. But even the Congressional Research Service concludes that "even if the responsiveness [of private saving behavior] to the estate and gift tax is as large as the largest [estimate of such responsiveness], the effect on savings and output would be negligible and more than offset by public dissaving." This consequence hurts our overall economy.

Again, the estate tax is a great thing and must be preserved.

(As for Bush, no comment.)
Posted by sethgecko13 9 years ago
sethgecko13
Ditto - Ironhead60 did a superb job. Breaking down the argument into discrete components with headings and addressing them was a very effective way at clearly presenting a complicated issue.
Posted by mjvoss 9 years ago
mjvoss
IronHead did an amazing job with this debate. I have to say, though, that saying "the repeal of the estate tax would cost $1,000,000,000,000 over the course of ten years" is an accountant's look at the future (it is not realistic). And economist would also look into *what* would happen without the estate tax.

1) The problem with taxes in general is that they have a very strong tendency to encourage people not to do something. Most of the time, it is getting rich. Getting rich should be every American's dream, since getting rich benefits the economy through maximized productivity. Free-markets rely on the selfish want of more money and increased benefits. The problem with the estate tax is that the more a person makes, the less they will be able to hand to their loved ones. In fact, something you did not mention, is that the estate tax is MORE in effect the MORE you make. If you make 2,000,000, you get taxed 780,000 PLUS 46% of any excess of that. So, what would happen if the estate tax were repealed? Well, it is quite possible that general productivity would increase. The level of increase is hard to determine, however.

2) You said that the estate tax promotes charitable giving. I'd like to ask how that is so. Also, a common misconception is that rich people horde their money. That actually is a half-truth. While there may be people like that, remember that it is the utmost goal of everyone to make more money. That means that this extra money would be reinvested into a company (if they got their riches from it), saved in a bank (such would bring benefits to banks and to everyone), or invested in stocks. So, what would happen if the estate tax were repealed? Well, since the money is being reinvested into the economy rather than inside the government's coffers, the tax revenue would most likely increase. This is evidenced by the 2001 Bush tax cuts, where the tax revenues increased so much that the federal deficit was cut in half.
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