Some Democrats even defected from Obama when it came to taxing the wealthiest Americans through the estate tax.
Obama wants to extend the current 45% rate, which applies only to inheritances exceeding $3.5 million for individuals and $7 million for couples. But the Senate, with the support of 10 Democrats, approved a proposal to lower the tax rate and raise the exemption.
The Senate plan would have cost $90 billion over 10 years for a tax break that would matter to only one-quarter of 1% of estates.
In the end, the Senate proposal for the lower tax rate was dropped during negotiations with the House.
The budget assumes that Obama's proposal to extend the current estate-tax rate will be enacted. Still, the episode showed a hesitancy among some Democrats to tax even the wealthiest Americans.
Though the budget blueprint did not specify how to pay for a healthcare overhaul, it gave Obama's health proposal a big lift: It authorized a procedural shortcut designed to circumvent Republican lawmakers if they attempt to block the measure by filibuster.
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janet.hook@latimes.com
