A Republican-lead effort to repeal the estate tax failed to even reach a vote on the Senate floor.
With 60 votes required to block a filibuster and end debate on the bill, 41 Senators voted against the measure and another two didn't vote, most falling along party lines and leaving repeal boosters with just 57 votes.
Senate majority leader Bill Frist, R-Tenn., has said that it would consider a floor vote on compromise proposals. The House passed a full repeal of the tax months ago, in a 272-162 vote, with more than 40 Democrats agreeing to abolish the tax. Since the House vote, Hurricane Katrina hit and the costs of the wars in Iraq and Afghanistan have come under closer scrutiny by the public.
President Bush phased out the estate tax as part of his first-term tax relief package, but after a one-year hiatus scheduled for 2010, the levy is scheduled to resume in full in 2011. According to the Tax Policy Center, about 12,600 estates will be taxed in 2006. The tax applies to inheritances in excess of $2 million -- and less than 1 percent of all taxpayers.
Opponents of the tax argue that it endangers family-owned businesses, discourages saving and investment, and forces people to spend on estate-planning efforts. Proponents of the tax say it is one of the nation's most progressive and that repealing the tax would benefit the richest just as the costs of Social Security and Medicare are set to reach their peak.
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