An Argument in Favor of Estate Tax to Promote a Fair Distribution of Wealth

Estate Tax Position Paper The basis on which America was built is that all people must work for their success. The government may be responsible for making sure all citizens are treated equally, but ultimately, all people must put in work in order to be rewarded. Therefore, many people feel that it is unfair for money to just be handed down to them without any real effort on their part. Because of this, the government imposes what is called an estate tax.

This tax is applicable to (as of 2013) any assets that are inherited whose total value exceeds $5.25 million. Because of this tax, a percentage of assets inherited that are greater than the previous stated number go to the government.

I believe that there should be an estate tax because the inheritor has not worked for this money, the inheritance can be put to better uses, like social work, and because taxing inherited wealth helps promote a fair distribution of wealth.

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As cited in the first paragraph, our country was built upon the idea that every citizen must work for his/her own success, and inheriting money goes against this very ideal. By placing a tax on inherited wealth, the inheritor is still getting the money that his/her parents left for him, but it takes a small portion of exorbitant amounts of inherited money so that money can be used for other, better causes. Which leads into a second point, the usage of money for a better cause. Wouldn't it be better for society if $4 million was used to help pay for poor peoples' insurance rather than buy one person a large, unneeded house? It isn't that the entire inheritance is being taken away, merely a portion of an extremely large sum so that it can be used for a more socially “good” cause.

Also, an estate tax could help promote a fairer distribution of wealth. If returns from estate tax collections are used for social welfare programs, it will help people who are in need of help financially, and this can in turn help them put money back into the economy. This helps distribute wealth more fairly. Some people may argue that inherited wealth has already been taxed over the lifetime of the person who earned it, such as through income taxes or other taxes, and that imposing an estate tax would be double taxation. However, this is not true. The inherited wealth is new to the inheritor, and is therefore ok to be taxed. Another argument people use against the estate tax is that money raised by an income tax is a “drop in the bucket” of the national deficit and that repealing it will not make a very big difference. However, this is simply not the case. According to an estimate by The Center on Budget and Policy Priorities, if the government were to repeal the estate tax, it would lose $1 trillion over the course of 9 years. The logic that estate tax returns are merely a "drop in the bucket" is flawed, because although it may be only one drop, it takes multiple drops to fill the bucket. Over time, the money could accumulate and be used for integral governmental programs.