VOTES AGAINST REPUBLICAN VERSION WHICH UNDERMINES VITAL EDUCATION SPENDING

WASHINGTON - Today, Congressman John Olver voted in favor of a Democratic bill to reduce the federal estate and gift tax for small businesses and family farms. However, Olver opposed the Republican version (H.R. 8) which eventually passed, lambasting that bill as a huge-tax break for the wealthiest Americans which would undermine efforts to improve education.

The Democratic alternative bill would have provided a 20% across-the-board reduction in estate and gift tax rates. Furthermore, for farms and small businesses, the current $1.3 million exclusion per person would be increased and changed to a $4 million exclusion per family. Olver voted to raise the $600,000 exclusion to $1.3 million in 1997.
"The Republican version of this bill is little more than a give-away to those who do not need a hand-out," said Olver. "The fact is that 98% of the American people pay no estate tax at all, and the Republican bill would end up helping only 2% of people in this country."

1998 IRS figures show that only 2% of estates are taxable. Of these estates, only 3% had significant farm or small business assets. This works out to be only 780 small businesses and 650 farms out of nearly 47,500 returns. These are the businesses and farms that would be helped by the Democratic bill.

"I recognize that some family farmers and small businesses need relief. That is why I support legislation to exclude up to $4 million for couples owning farms and small businesses," remarked Olver.

"The Republican leadership would have us believe that their bill will help working families. In fact, it will do that exact opposite by cutting into our efforts to improve education," Olver continued. "Just this week, the Republican°s put forth an appropriations bill that failed to fully fund Head Start and school construction programs, claiming the funds aren°t there. Yet within the blink of an eye, they turn around and want to give a $50 billion tax break to this country°s millionaires. It really crystalizes the difference in priorities between the Democrats and Republicans."

This week, the House of Representatives considered the Republican-sponsored Labor, Health and Human Services and Education Appropriation spending bill. Democrats have objected to the bill, which underfunds a number of the President°s key requests, including school construction bonds, worker training and Head Start programs.

President Clinton has indicated that he will veto the Republican-sponsored estate tax legislation.