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   Mr. ALLARD. Mr. President, recently, President Clinton vetoed legislation that would have repealed the estate tax, legislation that I strongly supported. I fundamentally oppose the estate tax. I call it the ``death tax.'' This has been a concern of mine for some time now. In fact, I have previously introduced legislation that would do away with this unfair tax.

   Congress has clearly demonstrated its support for easing this burden. The

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   The United States has one of the highest estate taxes in the world. While income tax rates have declined in recent decades, estate taxes have remained high. Today, the death tax is imposed on estates with assets of more than $675,000. The rates begin at 37% and very rapidly rise to 55%. Some estates even pay a marginal rate of 60%!

   This issue really hits home for me. Family farms and small businesses are two of the groups most affected by the estate tax. I grew up on my family's farm in Colorado, and I owned a small business before I came to Washington. So, I truly understand the concerns of those who live in fear of the impact that this tax will have on their legacy to their children.

   The estate tax has resulted in the loss of family farms and family businesses across the nation. Many people work their entire lives to build a business that they can pass on to their children. When these hard-working businessmen and farmers pass away, their families are often forced to sell off the business to pay the estate tax. I see this as an affront to those who try to pass on the fruits of their lives' work to their children.

   The people affected by this tax are not necessarily wealthy. Many small businesspeople are cash poor, but asset rich. For example, the owner of a small restaurant might have $800,000 of assets, but not much cash on hand. Her children will still have to pay an excessive tax on the assets. The beer wholesaler, who has invested all of his revenue in trucks and storage, might have more than $675,000 in assets. That does not make him a cash-wealthy man. Yet, he is still subject to this so-called ``tax on the wealthy.''

   The death tax also impacts employment and the economy. When a family-owned farm or a small business closes, the workers lose their jobs. Conversely, leaving resources in the economy can create jobs. A recent George Mason study found that if the estate tax were phased out over five years, the economy would create 198,895 more jobs, and grow by an additional $509 billion over a ten-year period.

   Additionally, the estate tax is a disincentive for Americans to save their earnings. The government has created a number of tax breaks and other incentives for those who save their money: 401(k)s and IRA's--to name a few. Yet, the estate tax sends a contradictory message. Basically, it says, ``If you don't spend all your savings by the time you die, the government will penalize you.'' This tax is no small penalty, either. We are talking about some very high tax rates.

   The death tax also represents an unjust double taxation. The savings were taxed initially when they were earned. Then, when the saver passes away, the government comes along and takes a second cut. There is no good reason for the current system--other than the government's desire to make a profit at the already trying time of the death of a dear one.

   The current death tax law has a greater effect on the lower end of the scale than the higher. Wealthy people can afford lawyers and planners to help them plan their estate. Those at the lower end of the estate tax scale are often unable to afford sophisticated estate planning. So the current law also makes the tax somewhat regressive, which is not fair.

   Planning and compliance with the estate tax can consume substantial resources. In 1995, the Gallup organization surveyed family firms. Twenty-three percent of owners of companies valued over $10 million said that they pay more than $50,000 per year in insurance premiums on policies to help them pay the eventual bill. To plan for the estate tax, the firms also spent an average of $33,000 on lawyers, accountants and financial planners, over a period of several years. This is money that could have been better spent to expand the business and create new jobs--rather than dealing with the death tax.

   The estate tax only raises one percent of federal revenue, yet it costs farms, businesses and jobs. No American family should lose their farm or business because of the federal government. I support full repeal of the federal estate tax.

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