Wednesday, Dec. 15, 2010 | 8:54 a.m.
The president’s two-year tax extension is all but guaranteed to pass the Senate later today, but bets are still off in the House, where it seems the bill’s fate is hanging in the balance of one provision backed, drafted and drilled by Nevada’s own Shelley Berkley.
Berkley’s estate tax revamp may have curried the favor of Republicans and the Obama administration, but it’s drawing the ire of enough of her fellow caucus members that it could, some say, be the bit that brings down the bill, absent some sort of change.
The provision is an attempt at re-righting the balance that’s set to be thrown off at the end of the year on estate taxes: come Jan. 1, taxes on all things inherited skyrocket up from zero to 55 percent for most Americans.
Berkley’s measure, which was incorporated into Obama’s bill that is expected to pass the Senate today, attempts to set that rate at 35 percent, and give an exemption on the first $5 million dollars that an individual inherits ($10 million if it’s a couple).
House Democrats who wanted the tax cut extension directed exclusively at the middle class have effectively lost that fight, but are now focusing their full attention on scaling back Berkley’s bill from its current levels to a more party-palatable 45 percent rate, with an exemption on the first $3.5 million of an estate.
“I want — absolutely — a separate vote on the estate tax,” said New York Rep. Louise Slaughter, chairwoman of the Rules committee, which will decide later today which proposed changes to the plan get a vote. “There’s no question in my mind that we need to do that. And some of us would like to have a vote on the middle class tax cut.”
But even with all the support, passing that amendment is not a done deal. They’ll have to pull along Republicans — who by and large, like the look of the estate tax.
That poses another potential complication: if the estate tax amendment does pass, is it going to sap away needed Republican support for the bill?
Democrats don’t seem to think so.
“If it’s adopted, and the Senate adopts it, the bill passes, flying away,” said New Jersey Congressman Bill Pascrell, outside a meeting of the Democratic caucus. “But if it’s not adopted, how many Democrats will vote no?”
They are likely counting their own numbers. Many Democrats have said their hands are essentially tied — like all parts of the bill or not, they’re running out of time to keep taxes down, and resuscitate lapsed unemployment benefits.
“I have had some problems with the deal, but I’m certainly not going to be in a position to not vote for something that gives people a tax break,” said Nevada Congresswoman Dina Titus Tuesday night, emerging from the meeting.
“There’s no whipping going on, and it’s more or less a conscience vote at this point,” Berkley said as she left the meeting. She said earlier this week that even if the Democratic caucus voted to change her estate tax provision, she’d vote for the bill. “I think you’re either going to accept the package as a whole, or reject the package as a whole...I am voting for it. That’s not deal breaker for me.”
But even that’s just political talk. When asked, Berkley admitted: there is no deal-breaker for her on this bill.