In some cases, the death of a loved one has triggered the sale of a successful family business just to pay estate taxes, critics note. In a recent report, the Institute for Policy Innovation, a Lewisville, Texas-based think tank, blasted the estate tax. The tax costs almost as much to collect as it brings in. Families can lose their farms and businesses just to pay the tax. The tax hits when people are weakest - after the death of a loved one.
Families can suffer the added loss of the deceased's lifetime work.
High estate-tax rates stifle savings and investment, harming economic growth. The institute predicted that seven year's after the estate tax's end, the gains in tax revenue from a stronger economy would balance the loss. Despite Clinton's harsh rhetoric, some Democrats support an end to the tax on small businesses and family farms. But they differ with Republicans on ending the tax for larger estates. To balance those cuts, the bill would impose capital gains taxes on assets that have grown in value.