WASHINGTON, DC-- Senator Susan Collins has released the following statement on compromise legislation to increase the minimum wage while providing much needed tax relief to American families and family businesses. The bill, which is expected to be considered by the U.S. Senate later this week, would also extend an expiring $250 tax credit for teachers that was originally authored by Senator Collins in 2001.
“I am pleased that the Senate will be taking action this week on legislation that would provide a long-overdue increase in the minimum wage, help families bear the cost of higher education, and ease the burden the death tax puts on family businesses.
“Given the length of time that has elapsed since the previous increase and the rate of inflation, minimum wage workers deserve to earn more money.
“In addition, I am pleased that this bill would extend legislation that I authored that provides valuable tax credits for teachers who incur out-of-pocket expenses to purchase classroom supplies. Many teachers spend hundreds of dollars a year of their own money on classroom supplies, and this $250 tax credit is a small but appropriate means of recognizing them for a job well done.
“The bill would fix the death tax, which in its current form, is untenable. As it stands now, the death tax phases out gradually each year until 2010, when it is eliminated entirely. In 2011, the tax returns in full to its pre-2001 levels (the year in which death tax relief was originally enacted). Thus, if someone dies on December 31, 2010, his estate would not be subjected to any federal estate tax. If, however, he died one day later, his estate would be subjected to the entire tax at the pre-relief levels, which could be as high as 55 percent. This has resulted in a system that makes estate planning a nightmare and is also fraught with unfairness.
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“My concern about the federal deficit, however, leads me to believe that this is not the appropriate time for full repeal. That is why I supported efforts to forge a compromise that would result in much needed reform of this broken system, but with less of an impact on the budget. I believe that this legislation, which reforms the estate tax, strikes the right balance.
“In addition, this bill includes other tax relief provisions that will benefit American families, such as tax relief for higher education expenses, and tax relief that will provide more opportunity to individuals who face employment barriers.”
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