[Weekly Compilation of Presidential Documents Volume 36, Number 23 (Monday, June 12, 2000)]
[Pages 1315-1316]
[Online from the Government Publishing Office, www.gpo.gov]

<R04>
Letter to the Speaker of the House of Representatives on Estate Tax 
Legislation

June 8, 2000

Dear Mr. Speaker:

    I recognize that some small businesses and family farms struggle 
with the estate tax and am committed to working with you to relieve this 
burden. I am supportive of targeted, fiscally responsible legislation to 
make the estate tax fairer, simpler, and more efficient. I believe the 
alternative proposed by Representatives Rangel, Cardin, and Stenholm, 
which would exempt most small businesses and family farms from the 
estate tax entirely, promotes these objectives in a fiscally responsible 
manner.
    We should not, however, turn our backs on fiscal discipline by 
passing a regressive, poorly targeted, and expensive repeal of the 
estate tax. If you send me a bill to completely repeal the estate tax, I 
will veto it rather than risk the fiscal progress that has contributed 
to the longest economic expansion in history.
    The cost of the estate tax repeal would explode just as the baby 
boom generation begins to retire, putting at risk our ability to extend 
the life of Medicare and Social Security, pay down the debt, and meet 
other important national priorities. The full cost of this legislation 
is hidden because the repeal is phased in over ten years. Although it 
would cost about $100 billion from 2001-10, the drain on the surplus 
would increase seven-fold to over $750 billion over the following ten 
years.

[[Page 1316]]

    Repealing the estate tax would undermine the progressivity, 
fairness, and integrity of the tax system. In 2010, the repeal of the 
estate and gift taxes would provide a $50 billion tax break. But this 
estate tax repeal would benefit only 54,000 estates--about 2 percent of 
decedents--providing an average tax cut of $800,000. Small businesses 
and family farms would receive a tiny fraction of the benefits of this 
proposal, while the largest estates would enjoy enormous windfalls. In 
addition, studies indicate that, without the estate tax, charitable 
donations and bequests would fall by $5 billion to $6 billion per year.
    I would like to work with the bipartisan Congressional leadership to 
enact legislation to reduce the burden of the estate tax on small 
businesses and family farms, provided it is done in an overall framework 
of fiscal discipline that strengthens Social Security and Medicare, 
invests in key priorities, and pays down the debt by 2013. I look 
forward to working with you to accomplish this goal.
     Sincerely,
                                                  Bill Clinton