WASHINGTON — The Senate on Wednesday overwhelmingly passed a measure that would extend the Bush-era tax cuts for two more years and would set the estate tax at 35%, with a $5 million exemption, winning praise from retail groups.
In an 81-to-19 vote, the Senate preserved the lower tax rates for all income levels, and also agreed to extend unemployment benefits. Also included was a one-year Social Security payroll tax cut for most workers.
Of significant concern to many retailers was the estate tax — a levy on inherited wealth — which was scheduled to return at a rate of 55% in 2011 after it had expired at the end of last year.
"The estate tax provision is essential to the continued success of family-owned retailers and wholesalers," said Peter J. Larkin, president and chief executive officer, National Grocers Association, Arlington, Va. "Additionally, the extension of the 2001 and 2003 tax rates is important to the economic recovery by creating jobs and capital for business growth. We call on the House of Representatives to quickly pass the bill as passed by the Senate."
Leslie J. Sarasin, president and CEO, Food Marketing Institute, also called on the House to pass the bill. "Keeping taxes low for small businesses, easing the burden of the estate tax on family-owned companies and allowing for enhanced depreciation of investments for businesses of all sizes are what we need to help our economy grow and create jobs," she said.
The House was expected to vote on the bill by the end of the week. Several House Democrats said they opposed the 35% estate tax and $5 million exemption, with some calling for a higher rate and lower exemption.
