The amendment also would have set the rate for taxation to the capital gains rate, with an exemption ceiling of $25 million to take effect as of 2010.
Estates beyond the $25 million threshold would be taxed at a 30% rate.
Kyl agreed to withdraw the amendment after Baucus agreed to hold a hearing on the issue and a markup of an estate tax bill “next spring.”
“An interest in dealing with the estate tax issue among members of both parties still exists,” says Larry Raymond, president of the Association for Advanced Life Underwriting, Falls Church, Va.
But Baucus’s comment about scheduling “significantly diminishes the prospects for action on the estate tax in 2007,” Raymond says.
Legislation similar to the Kyl amendment came close to passing in 2006.
Sen. Blanche Lincoln, D-Ark., had also planned to introduce an estate tax amendment during the markup.
The Lincoln amendment would have increased the amount of farm land that families could exclude from estate tax calculations.
Lincoln decided not to offer her amendment after Baucus and Kyl reached their agreement.