In mid April, the Republican-controlled House voted to repeal the estate tax, which, despite the GOP’s “death tax” messaging, affects only the superrich: Of the nearly 2.6 million Americans who died in 2013, just 4,687 had estates flush enough to trigger the tax. That’s because the bar to qualify for the estate tax is quite generous: The first $5.43 million of an individual’s wealth is exempt from the tax, and that amount goes up to $10.86 million for married couples. After that point, the tax rate is 40 percent.
The Center for Effective Government (CEG) calculated how much the 25 richest Americans would save if this repeal on the estate tax were to become law. The final tab: $334 billion.
That’s a lot of cash! CEG calculated that $334 billion in taxes would be enough to:
- Cut the nation’s student debt by one-third: The total could be distributed by giving $25,000 in debt relief to each of the 13 million Americans trying to pay off student loans.
- Repair or replace every single deficient school AND bridge in America: Give kids more resources for a better education, and get the country’s structurally deficient bridges up to snuff.
- Give every new US baby a chunk of change: $1,000 at birth, and then $500 a year until their 18th birthday, making a $10,000 nest egg to put toward education, a home, or other opportunities.
- Repair all leaking wastewater systems, sewage plumbing, and dams: Thus improving the health of lakes, rivers, and oceans nationwide.
Of course, it’s unlikely the tax will actually get repealed. Even if the bill makes it past the Senate, President Obama has promised to veto it. But as the election season heats up with economic inequality at its forefront, the repercussions of the bill are likely to be more political than financial. As Robert J. Samuelson writes at the Washington Post, the GOP has “handed Democrats a priceless campaign gift: a made-for-TV (and Internet) video depicting Republicans as lackeys of the rich.”