posted on: Thursday, April 01, 2010

By Niki Jagpal

Does anyone remember a time when we didn’t have an estate tax? If you don’t, you will next year – it was repealed for one year this January.

A couple of days ago, NCRP signed on to a set of principles developed by the coalition Americans for a Fair Estate Tax (AFET) that calls for permanent reinstatement of the estate tax when the issue comes back to the Hill in 2011. We were approached by United for a Fair Economy, a great organization that’s helping AFET circulate a letter in support of the principles now on the Hill.

Why did we sign on to the principles? For starters, we’ve supported AFET’s previous efforts to make the estate tax laws fairer in the past (in 2002 and 2005). NCRP believed then, as we do now, that the estate tax encourages charitable giving. The principles cite 2004 CBO analysis that supports this: it estimated that if the estate tax hadn’t existed in 2000, there would have been a significant drop in the range of $13 to $25 billion in charitable giving that year. That was nearly a decade ago – and we’re not talking small change here.

The principles state that the estate tax:

a) raises revenue that we need to invest in the American people;

b) ensures that families who have benefited the most from public goods pay their fair share to maintain them;

c) provides a check on the concentration of power in the hands of those born into great wealth;

d) corrects a feature of our tax system that would otherwise allow certain income to escape taxation entirely; and,

e) encourages charitable giving.

If you come to this blog or our site frequently, you probably know our mission and that we challenge grantmakers to strengthen our diverse communities. Our principles of exemplary philanthropy are that it serves the public good and not private interests, employs grantmaking practices that most effectively help nonprofits achieve their missions, and strengthens democracy by prioritizing those with the least wealth, opportunity and power. The similarities between the AFEET principles and ours speak for themselves.

AFET is calling for Congress and the Obama administration to exempt the first $2 million of estate assets ($4 million for married couples) and establish a tax rate that is at least 45 percent for the taxable part of estate assets. As the principles state: “A fundamental tenet of a fair tax system is those who have the greatest ability to pay should pay a larger share. Great wealth is the best indicator of ability pay. The estate tax should continue to target the very wealthy, and the largest estates should be taxed at a higher rate.”

Does your organization agree that with great wealth comes a moral obligation to give back to the community? If it does, please add your name to the list of supporting organizations and sign on to AFET’s principles by contacting Lee Farris at UFE and Richelle Friedman at the Coalition on Human Needs.


Niki Jagpal is research and policy director at the National Committee for Responsive Philanthropy (NCRP).