As I was saying …

Congress once again is considering what to do with the estate tax, that most insidious of taxes, which puts a levy on the inevitable. Under current law, the "death" tax is 45 percent of individual estates valued at more than $3.5 million; it is set to expire altogether next year and, unchanged, would revert to 55 percent on estates valued at more than $1 million in 2011.

Confusing? You bet, and that's either part of the problem, part of a larger scheme to obfuscate things or both.

The Obama administration has proposed an ongoing tax rate of 45 percent on estates exceeding an exemption level of $3.5 million per person. Advocates argue, among other things, that 45 percent and $3.5 million are still better than 55 percent and $1 million and the tax would only apply to the "wealthy."

The U.S. Senate recently voted 51-48 to permanently cut the estate tax rate to 35 percent with a $5 million per-person exemption. Administration officials and some Senate Democrats expressed their outrage; Senate majority leader Harry Reid (D-Nev.) called the vote a "stunning act of hypocrisy."

Well, here's an even more stunning idea: Let's eliminate the thing entirely. There are lots of good reasons to get rid of it. There is, first, the practical argument: Imposing a high estate tax forces many small businesses and farms to be sold when their owners die—surely not an outcome anyone wants. And sapping small-business-owning families of cash almost always means less investment and job creation.

A second practical issue is that current law—and all the proposed changes to it—make it difficult for anyone to figure out when to die. Right now, dying in 2010 makes good sense if you want to take care of your survivors. Dying in 2011 is not so attractive. The more serious point is estate planning is almost impossible without some assurance of consistency.

Then there is the more important issue: whether taxing an estate is justifiable. After all, what is an "estate" if not an accumulation of earnings that have already been taxed? Why should the inevitable act of dying entitle the government to part of an estate? Instead, let's have estates pay a capital gains tax on the income earned and allow small businesses—the real growth engine of this economy—to do what they do best.

To voice your opinion on this issue, contact your representatives and senators and please copy NRCA on your correspondence.

Bill Good is NRCA's executive vice president.