Almost in time for the debate over the Senate's vote to increase the estate tax exemption to $5 million, the Tax Policy Center has updated its tables on who the tax hits and for how much. What I like about the tables is that its easy to compare the effects of current law (in which the exemption returns to $1 million) to the Obama plan (in which the exemption is an inflation-indexed $3.5 million) and the Lincoln-Kyl plan ($5 million exemption) that the Senate passed last week.
The estate tax debate tends to boil down to issues of fairness that render the above information more-or-less useless. But the empirical debate is still interesting. And one thing it shows is that the choice between the Obama plan and the Lincoln-Kyl plan isn't a choice between a world in which fascist stormtroopers break up the plots of every small farmer and a world in which various would-be aristocrats can accumulate their way back to the 19th-century.
The current law distribution would affect about 46,000 estates and raise about $35 billion dollars in 2007. The Obama plan would affect about 6,000 estates and raise about $18 billion. And the Lincoln-Kyl plan would affect 3.600 estates and raise about $11.5 billion. In other words, both the Obama plan and the Lincoln-Kyl plan substantially reduce the amount of revenue and the number of estates taxed.