Perhaps the greatest public relations coup of this decade was the successful persuasion of millions of Americans that repealing the estate tax was a populist cause.
That is Floyd Norris in the New York Times (here). His view reflects one of the bigger misconceptions about public opinion of the estate tax: that support for its repeal derived from the wily strategies of conservatives who hoodwinked the public with clever Luntzian phrases like “death tax.”
In fact, opposition to the “death tax” is not much greater than opposition to the estate tax. In 2002, the National Election Studies conducted a question wording experiment that randomly assigned respondents to be asked about the estate tax and death tax. 72% favored repealing the estate tax; 75% favored repealing the death tax.
Moreover, as Larry Bartels argues in Unequal Democracy—in a chapter that has received far less attention than the chapter with this finding— public support for inheritance is hardly new. He cites a 1935 em>Fortune survey that asked “How much money do you think any one person should be allowed to inherit?” Fully 52% of respondents said there should be “no limit.” 3% said over $1 million, 16% said $100K to $1 million, and 15% said $100,000 or less. Given that these dollar amounts are in 1935 dollars, and that the survey was conducted during the Great Depression, it’s safe to say that a large fraction of the public was and is comfortable with large inheritances.
In Bartels’ view, public opinion about the estate tax is not a story of conservatives beguiling a liberal or egalitarian public.
…the real “political mystery” is why not why the estate tax was phased out in 2001, but why it lasted as long as it did. The answer to that question has little to do with conservatives elites’ grasp of public opinion, but much to do with the political leverage of liberal Democratic elites whose own ideological values make them eager to retain “a steeply progressive tax.”
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Does the public support for repeal of the “death” and/or “estate” taxes extend to carryover of tax basis of the decedent rather than a new date of death value (often referred to as “stepped up”) basis for tax purposes to the beneficiary? Or does this public support not want untaxed appreciation ever to be taxed upon sale or exchange by the beneficiary?
Does Bartels assess the reliability of the Fortune survey? This is around the time of the famous Landon poll, isn’t it?
I’m not sure how relevant that Fortune poll is, since capping inheritances is very different from taxing them.
Even if “death” vs. “estate” doesn’t make much difference, the estate tax does seem to be one of those issues where the way a question is posed can dramatically influence polling results. When people are asked whether or not the estate tax should be eliminated, most people want to get rid of it. But when they are also offered the option of reforming the estate tax by reducing the rate, that option is more popular than complete elimination (e.g. here, and from Luntz’s own organization in the BNA Tax Report available here).
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