Minor Thoughts from me to you

Life Insurance Likes the Estate Tax

It turns out that the life insurance industry loves the estate tax.

The life insurance industry's lobbying presence in D.C. is huge - larger than almost any other industry sector. According to the report, life insurers spent $10 million per month on lobbying in the first half of 2010. Only the pharmaceutical, electric utilities and oil and gas sectors, the heaviest of heavy hitters, spent more.

Life insurers spent more on lobbying than even bankers and health insurers.

One of the most outspoken voices urging a higher estate tax, Warren Buffet, owns six life insurance companies, the report says.

The report was produced by the American Family Business Foundation, an ardent opponent of the estate tax, and written in part by Tim Carney, a senior political columnist at the Washington Examiner.

It's really not hard to understand why the life insurance companies would love the estate tax. Most wealthy people don't have banks and mattresses stuffed full of money. They own expensive assets: businesses, houses, artwork, the Yankees, the Cowboys, etc. When they die, and their estate is suddenly taxed at 55%, the heirs are left with unpalatable choices. Do you sell the Yankees, to pay the tax man?

In steps the helpful life insurance company. For a hefty annual premium, they can help provide the money to pay the tax man, without needing to sell cherished family assets. If the estate tax goes, how many of these wealthy individuals will need life insurance? None, probably. Poof. There goes 10% of the industry's revenues.

Fight "the man". Fight oligarchic "capitalism". Fight crony capitalism. Fight the estate tax.

This entry was tagged. Government Taxes