Barry Ritholtz, Columnist

The Estate Tax Debate We Shouldn't Be Having

It affects few Americans and does more good than harm. Let's hope the next president focuses on more important issues.

September 12, 2016 at 7:09 PM UTC

Barry Ritholtz is a former Bloomberg Opinion columnist. He is chairman and chief investment officer of Ritholtz Wealth Management, and was previously chief market strategist at Maxim Group. He is the author of “Bailout Nation.”

Not exactly the norm.
Photographer: VICTORIA AROCHO/Bloomberg

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Greg Mankiw, the Harvard professor and former adviser to President George W. Bush, has called for abandoning the estate tax. His argument, supported by anecdotal evidence and some wonky explanations, isn't terribly persuasive. But he did remind us that Democratic presidential candidate Hillary Clinton wants to "increase the tax by reducing the threshold to $3.5 million and raising the rate to 45 percent," while Republican nominee Donald Trump wants to eliminate it. At the very least, we should be thinking about what really should matter to the incoming administration.

There are many other tax issues that are far more important than the estate tax. The current corporate tax system is a structural mess, and it is the most important tax issue facing the U.S. today. For proof of its absurdity, look no further than the egregious carried interest loophole.