Although Senate Republicans still lack the 60 votes needed for estate tax repeal, they may schedule a procedural vote, in order to assess where each Senator stands on the issue, according to media reports late last week. The vote would come after weeks of Senate negotiations on possible reform specifics that have yielded little in the way of a compromise. If a vote does occur this week, it would likely serve to increase pressure on Democrats to reach a compromise, and also, according to a July 22 Wall Street Journal article, to "smoke out reluctant senators" just before the August recess. Despite the possibility of an estate tax vote, the thus-far unsuccessful efforts of Senate Finance Committee Chair Jon Kyl (R-AZ) to reach a compromise with Finance Committee Ranking Member Max Baucus (D-MT) seem to have created a rift within the anti-estate tax faction. While many Republicans are fighting for estate tax "reform" to greatly increase the exemption level and reduce its top rate, others are becoming more vocal in criticizing this effort and arguing that Kyl should fight only for full repeal. This fissure was demonstrated in a July 20 letter to Majority Leader Bill Frist (R-TN), from a number of Washington's most powerful business groups and anti-tax leaders. The letter urges Frist to "take the fight for full repeal to the Senate floor. We believe it would be a serious mistake, and exceptionally difficult to again explain to small business, if a compromise is advanced without first giving the small business community the opportunity to actively put their resources to the task of delivering the votes for full repeal." Also thwarting efforts for repeal were comments made by Federal Reserve Chairman Alan Greenspan in testimony given July 21 before the Senate Committee on Banking, Housing, and Urban Affairs. Greenspan reiterated his opposition to tax-cut proposals that would increase the deficit and, when questioned by Sen. Charles Schumer (D-NY), agreed that now would not be a good time to move forward with estate tax repeal, if it did not include PAYGO offsets. According to the conservative estimates of the Joint Tax Committee, full repeal of the estate tax would cost $290 billion from 2006 - 2015. Further undermining anti-estate tax arguments was the release this month of a Congressional Budget Office (CBO) report on the number of farms and small businesses actually affected by the estate tax. The report, put together at Baucus' request, effectively lays to rest the myth that the estate tax poses a significant threat to America's farms and small businesses by levying too large a tax on families who can not afford to pay it. This has been a main claim made by anti-estate tax proponents, including President Bush recently, making the CBO report all the more timely and significant. The report finds that very few farms are affected by the estate tax with 2005 exemption levels (and thus even fewer would be affected by exemption levels through 2009). In fact, if the current exemption level of $1.5 million were to have been in place in 2000, only 300 farms would have owed any estate tax. Raising the exemption to $3.5 million, the 2009 level, drops the number of farms affected to 65. Notably, the CBO found that of the few farms that would owe taxes, most of them had sufficient liquid assets, so that heirs could pay the tax without needing to consider selling any portion of the farm. Using farm data for the year 2000, the CBO found that if a $3.5 million exemption had been in place, only 13 farms in the entire nation would lack funds to fully pay the tax, and for these farms, other payment options are available to spread out the estate tax payment over as much as 14 years. While some lawmakers with the power to vote on repeal (or reform) of the estate tax are still under the impression that a vote to preserve the estate tax is a vote against family farms and small businesses, the CBO report makes clear that this is not the case. It states that exemption levels of "$1.5 million, $2 million, or $3.5 million… along with a 48 percent tax rate and a large Qualified Family-Owned Business Interest (QFOBI) deduction, would substantially reduce the number of small businesses and farmers affected by the estate tax." As lawmakers ponder the future of the estate tax this week, they should take into consideration the findings of the CBO report, as well as Greenspan's testimony. Eliminating yet another revenue source at a time when deficit spending is out of control will only further throw off the nation's fiscal balance, all while giving more kickbacks to the wealthiest members of society. You can take action on this issue by contacting your Senators and telling them to vote no on repeal or irresponsible reform, and by writing a letter to the editor of your local paper using this US Action web tool.