On Thursday. Republican efforts to repeal the estate tax were rejected by the senate, depriving the GOP of a chance to put the issue immediately onto the Senate's election-year agenda.

Republicans pledged not to give up. Majority Leader Bill First of Tennessee said that wiping this vicious tax from the books is a matter of principle. Senators voted 57-41 to limit debate and proceed toward a vote on repeal, but that was three short of the 60 needed. Florida's senators, Republican Mel Martinez and Democrat Bill Nelson, both voted to support the bill that would have killed the tax.

Members of the senate who opposed to the bill said it would deliver an unwise tax cut when the government needed more money to balance its budget and to wage war. However, republicans staged the vote knowing they did not have the 60 votes to prevail on repealing the tax, a top priority of many GOP voters. Some of the tax's biggest critics had hoped they could attract a few extra votes by extending a cooperative hand to Democrats.

On the other hand, Sen. Jon Kyl, Arizona, proposed an alternative that would have relieved more estates from taxation by letting an individual's estate worth $5 million, or a couple's worth $10 million, escape taxation. That exclusion would increase each year to keep pace with inflation.

Most estates exceeding that size would be taxed at capital gains tax rates. The very largest, when exceeding $30 million, would be taxed at 30 percent. Setting the tax rate for most estates equal to capital gains would put living business and property owners on equal footing with heirs, he said.

There were few democrats who reached for the deal, and some criticized the offer as tantamount to repeal. However, two Republicans, Sen. Lincoln Chafee of Rhode Island and George of Voinovich of Ohio, broke with their party and voted against the effort. Both said the government, with its annual budget deficits, could not afford the tax cut.

By M. Sese
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