SEIU: Hidden Costs of Estate Tax Repeal Would Harm Members

New Report: "Death Tax" is False Advertising

Report Reveals Only 91 Louisiana Estates Paid Estate Tax--SEIU Finds Hidden Costs of Repeal Would Harm Members, Working Families


For Immediate Release: Contact: Maria Wickstrom,
Emma Dixon
July 12, 2006 Phone: (225) 281-2467
(985) 674-1551

Baton Rouge, Louisiana- Today the Service Employees International Union Local 21, a public service employee union in Louisiana, released the USAction/Emergency Campaign for America's Priorities report entitled "Protecting Louisiana's Priorities: The Hidden Costs of Repeal or Drastic Reduction of the Federal Estate Tax" to its members who struggle to make ends meet on two or three jobs. The report (read it at http://www.usaction.org/site/pp.asp?c=eiJPJ5OVF&b=1725009) reveals the great cost estate tax repeal or reduction would have to Louisiana for the benefit of a mere 91 multimillionaires.

"The city and school support workers who make up SEIU Local 21 want to remind Senators Vitter and Landrieu that they barely make ends meet and the middle class is slipping away from them every day," said Maria Wickstrom, President of Local 21LA. "The people of Louisiana elected our Senate leaders to look out for the interests of working families–not heirs and heiresses to the very rich." The estate tax repeal and recent estate tax reduction proposals favor the lucky few born with silver spoons in their mouths over the hardworking Americans who make up the vast majority of this country.

On Sen. Landrieu's recent proposal to raise the exemption levels and lower the rates on the estate tax, Wickstrom commented today: "We do not support Landrieu's estate tax bill. We oppose a repeal and any modified version of a repeal. Landrieu's version may not be as costly as a full repeal but it is still a proposal that benefits the wealthy, adds to our looming deficit, and exacerbates income inequality."

SEIU also released to its membership an open letter to senators, reproduced below, from the Leadership Council of Aging Organizations, of which SEIU is a signatory, pointing out the many important services that would suffer with the huge revenue loss that estate tax reduction would cause.

Both nationally and in Louisiana, SEIU is joining with the Emergency Campaign for America's Priorities (ECAP) and United for a Fair Economy to call for the senators to vote no on H.R. 5638, a proposal to slash the taxes multimillionaires would have to pay on their estates. The Senate is expected to vote on the proposal this month.

Eighteen families worth almost $200 billion, including the Walton family, founders of Wal-Mart, have mounted a relentless, decades-long campaign to repeal the estate tax. A repeal would give multimillion dollar tax handouts to the wealthy while pushing a larger tax burden on middle class families and forcing cuts to vital public services.

"The term death tax, cooked up by these multimillionaires and their allies, is false advertising. In fact, the report says that a mere 0.2% of Louisiana estates had to pay the estate tax in 2003. Meanwhile, many more would suffer the loss of public services and the financial burden of this tax break if it is passed by the Senate this month," said Belinda Antoine, Jefferson Parish school bus driver and member leader of SEIU Local 21.

Antoine says, "Our union members say to Senators Vitter and Landrieu -- would they rather give tax breaks to 91 Louisiana millionaires than ensure all children in our state get adequate healthcare, no Americans go hungry, and no hardworking parent has to forego higher education for their children due to the financial burden? You decide what kind of country we want to live in."

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Open Letter to Senators from the Leadership Council of Aging Organizations:
2519 Connecticut Avenue, NW, Washington, D.C. 20008
202-783-2242
www.lcao.org
William (Larry) Minnix, Jr., Chair

July 12, 2006
Dear Senators Landrieu and Vitter:

The undersigned members of the Leadership Council of Aging Organizations (LCAO) are writing to express our opposition to H.R. 5638, the Permanent Estate Tax Relief Act.

This bill would drastically reduce federal revenues that are needed to meet critical challenges and curb record deficits. According to the Joint Committee on Taxation's estimate, H.R. 5638 would cost $280 billion over the next 10 years, and $602 billion between 2012 and 2021 – the first ten-year period in which its costs can be fully measured ($762 billion if the costs of the additional interest payments on the debt are included). With the Office of Management and Budget estimating this year's federal budget deficit at $423 billion and forecasting continuing and substantial deficits for at least the next five years, now is not the time to enact a huge revenue loss.

Currently, only estates larger than $2 million for an individual ($4 million for a couple) are subject to the estate tax; only about one percent of estates pay any estate tax at all. The estate tax gets all its revenues from the wealthiest 1.4 percent of Americans, and two-thirds of it from the top 0.2 percent. The drastic reduction of the estate tax contained in H.R. 5638 would result in even higher budget deficits along with higher taxes on middle class and working Americans to make up for the revenue loss.

These revenue shortfalls would come just as the baby boom generation begins to retire and Social Security, Medicare, Medicaid and other senior programs come under increasing financial pressure. We need to plan responsibly for the retirement of the baby boom generation, not put ourselves in a deeper hole that will make fulfilling our obligations even more difficult.

Contrary to claims that the estate tax hurts family farmers, the American Farm Bureau Federation acknowledges that it cannot cite a single example of a farm having to be sold to pay estate taxes. Of the less than one in twenty farmers that leave a taxable estate, the average tax payment is only $5,000.

At a time when our nation is struggling to curb the growth of record-high deficits, the last thing we need is yet another tax cut for the richest one percent of Americans. No argument has been made that cutting the estate tax will stimulate economic growth or result in any other benefit to the vast majority of Americans. We urge you to vote for fiscal discipline, fairness and compassion, and to vote against irresponsible estate tax reduction that would further increase an already high and growing debt burden on current and future generations of Americans.

Sincerely,

AFL-CIO
AFSCME Retiree Program
Alliance for Retired Americans
American Federation of Teachers Program on Retirement and Retirees
American Association for International Aging
Families USA
Gray Panthers
International Union, United Auto Workers
National Association for Hispanic Elderly
National Association of Nutrition and Aging Services Programs
National Association of Professional Geriatric Care Managers
National Association of Social Workers
National Citizens' Coalition for Nursing Home Reform
National Committee to Preserve Social Security and Medicare
National Council on Aging
National Association of Retired Senior Volunteer Program Directors
National Associations of Senior Companion Program Directors
National Academy of Elder Law Attorneys
National Caucus and Center on Black Aged
National Indian Council on Aging
National Senior Citizen's Law Center
OWL, the voice of midlife and Older Women
Service Employees International Union

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