Power surge – Wealthy worry about poor

Some of America’s wealthiest individuals have launched a campaign opposing plans by President Bush to repeal taxes on estates and gifts, The New York Times reported Feb. 14.

In a petition drive organized by William H. Gates Sr., father of the Microsoft founder, 120 of the nation’s richest people say “repealing the estate tax would enrich the heirs of America’s millionaires and billionaires while hurting families who struggle to make ends meet.”

Bush’s plan to phase out the estate and gift taxes by 2009 would cost government billions of dollars and lead to higher taxes on people less able to pay, or in cuts to Social Security, Medicare, environmental protection and other social programs, the petition says.

And because many wealthy people contribute to charity to help reduce the size of their estates, the petition says, repeal would hurt charities by removing that incentive to give.

“The estate tax exerts a powerful and positive effect on charitable giving,” the petition says. “Repeal would have a devastating impact on public charities.”

Signers include billionaire financier George Soros; philanthropist David Rockefeller Jr., former chairman of Rockefeller & Co.; Steven C. Rockefeller, chairman of the Rockefeller Brothers Foundation; philanthropist Agnes Gund, whose family owns shares in many companies; and Ben Cohen, a founder of Ben & Jerry’s.

Omaha investor Warren Buffett, who ranks fourth of the Forbes magazine list of the wealthiest Americans, opposes repeal but told the Times he didn’t sign the petition because it didn’t go far enough in defending “the critical role” of the estate tax in boosting economic growth by helping to create a society in which merit rather than inheritance determines success.

Buffett and Microsoft founder Bill Gates have both said they will give away most of their wealth in bequests at death, the Times said.

Many signers of the petition have long ties with charities that depend heavily on gifts, including bequests, and they fear outright repeal of the estate and gift taxes would trigger a plunge in charitable giving, the Times said.

For full story, go to The New York Times.

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