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I want this evening to discuss with you an important proposed
amendment to the federal estate tax law, under which the deduction
allowed for charitable bequests-now unlimited in amount
-would be limited to a specified percentage of the testator's estate.
The most frequently mentioned figure is 50 per cent. Similar
proposals to emulate the income tax by imposing a percentage
limit on the deduction of charitable contributions have been
floated from time to time for at least 35 years, but recently these
trial balloons have attracted more attention on Capitol Hill than
ever before. By itself, the issue is a narrow one, affecting only a
small fraction of estates; but I propose to show that it raises fundamental
issues about the nature and objectives of death taxation
and that, on analysis, the proposal for a percentage limitation
turns out to rest on a faulty foundation. This analysis also exposes
parallel shortcomings in the rationale underlying several other
proposed changes, such as converting the deduction into a tax
credit or substituting a system of matching federal grants to charitable

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