By a vote of 81 to 19, the Senate has passed the $858 billion tax compromise worked out between President Obama and Senate Republicans that includes a key provision keeping the estate tax at levels acceptable to agricultural interests.

The measure reduces the top rate of the estate tax, more appropriately known as the “death tax,” to 35 percent, increases the exemption level to $5 million, index exemptions to inflation, and includes a stepped-up basis.

National Cattlemen’s Beef Association (NCBA) President Steve Foglesong, who is currently in Washington DC, was relieved to see this action taken by the Senate. “The Senate’s vote to extend the current tax rates and bring the estate tax down to more reasonable levels offers a great deal of relief to U.S. cattlemen and women right before the New Year,” said Foglesong in a statement.

Without the bill, the tax would have gone back to pre-2001 levels at 55 percent and an exemption level of $1 million on January 1, which would have a devastating impact on farmers and ranchers who wish to pass on family-owned operations after their death. The American Farm Bureau Federation calls estate tax relief the “single most important tax issue” for America’s farm and ranch families. The bill also includes an extension of the ethanol blenders tax credit, or VEETC, and a retroactive extension of the biodiesel tax credit which expired at the end of 2009. Both tax credits would now expire at the end of 2011.

The deal now goes to the House, where some Democrats have already indicated they will try to make changes in the estate tax which they consider giving too much to the wealthy. It is still expected to pass.