Hillary Clinton proposed raising the top estate tax rate from 40 percent to 65 percent for the wealthiest families, with inheritances of $500 million or more. Photo by Rebecca Cook/UPI | License Photo
WASHINGTON, Sept. 22 (UPI) -- Democratic presidential nominee Hillary Clinton on Thursday released an updated tax plan that would impose a 65 percent tax on estates for the wealthiest individuals in the country.
By contrast, her Republican opponent, Donald Trump, has proposed eliminating the estate tax entirely.
The present tax code has a 40 percent tax rate on any inheritances worth more than $1 million, and in 2016, the first $5.45 million of an estate can be passed to heirs tax-free.
Under Clinton's plan, three higher brackets would be put in place, one at 50 percent for estates over $10 million, 55 percent for estates over $50 million and 65 percent for estates worth more than $500 million.
Republicans and Democrats in Washington have fought over the estate tax, also referred to by critics as the "death tax," for years. Supporters argue it is an essential tool to prevent the concentration of wealth in a few massively rich families. Opponents view it as an unfair double-taxation on wealth -- investments and income the individual paid taxes on while alive that is taxed again after they die.
Overall, according to The Wall Street Journal, the estate tax is a relatively small part of the federal tax code, bringing in about 1 percent of the government's tax revenue. Clinton's changes would bring in an estimated $260 billion over 10 years, money she said could be used to expand the child tax credit and fund changes to the small business tax code, which she has proposed simplifying and reducing.