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Daschle Doubts Estate Tax Repeal Will Survive Senate Vote

Before the House voted to repeal the estate tax Wednesday, the top Senate Democrat said the bill faces a tougher challenge in his chamber.

“We haven’t done a recent head count, so I don’t know whether the votes are there or not; [but] I don’t think they are,” Senate Minority Leader Tom Daschle (D-S.D.) said. “I don’t think they have the votes to repeal.”

Nonetheless, House Republicans pushed through the bill, identical to one approved last year. And House Democrats, while pleased that they were allowed to debate an alternative drafted by Rep. Earl Pomeroy (D-N.D.), were frustrated that the Rules Committee did not permit the substitute in its entirety.

Pomeroy said his bill, which would have exempted estates worth $3 million or less ($6 million per couple) from taxation, would have freed 99.65 percent of all estates from taxes.

Tuesday night, the Rules Committee agreed to bring his substitute to the floor, but stripped its offsets. Pomeroy wanted to cover its estimated $30 million cost by ending corporate tax shelters and employing customs user fees.

Democratic attempts to bring up the original Pomeroy substitute failed on a party-line vote.

Republicans argue the estate tax has outlived its usefulness and unfairly prevents people from passing on wealth to their children — and therefore needs to be repealed outright.

Democrats say the tax should be tweaked but not abolished since it primarily benefits the richest households. Bill Gates Sr., father of Microsoft chief Bill Gates, came to Capitol Hill on Tuesday to encourage lawmakers to support Pomeroy’s version.

Nick Smith, spokesman for Senate Majority Leader Bill Frist (R-Tenn.), said the Senate is focused on Medicare right now but leaders are “continuing to discuss options for the estate tax.”

Meanwhile, Democrats are trying to pressure House Republicans into accepting the Senate version of the child tax credit expansion.

House Minority Whip Steny Hoyer (D-Md.) is running a clock outside his office that counts the time since the House passed its version of the child tax credit — which included several unrelated tax-cut provisions — saying that doing so denied millions of children assistance.

In response, Jonathan Grella, spokesman for House Majority Leader Tom Delay (R-Texas) said: “It’s about time that they quit griping and start governing.”

Democrats will make another push late Wednesday, when the House votes on the Taxpayer Protection and IRS Accountability Act. Rep. Charlie Rangel (D-N.Y.) will offer a substitute that would, among other things, accept the Senate’s child tax credit bill.

The two bills could go to conference as early as this week, however it was unclear which chamber would budge.The Senate appointed conferees Wednesday.

The $10 billion Senate version deals only with the child tax credit extension; the $82 billion House bill is a wider-ranging piece of legislation dealing with taxes beyond the child credit.

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