DEATH TAX REPEAL INTRODUCED
U.S. Representative Kenny Hulshof (R-MO) and U.S. Representative Robert "Bud" Cramer (D-AL) have introduced the Death Tax Repeal Permanency Act of 2007.
"The complete repeal of the death tax has earned bipartisan support and passed the House on numerous occasions," said Hulshof. "Small businesses and family farms face the threat of a punitive death tax that could undo a lifetime of hard work and thrift. If we fail to act, the death tax will come back with a vengeance in 2011. It's time to give taxpayers certainty on this matter of fundamental fairness."
Relief from the death tax was passed in 2001. Current law phases-out the tax until it is completely repealed in 2010. However, if Congress fails to act, the tax will spring back to life, with full job-killing force in 2011, subjecting the hard work of family owned businesses and farms to a tax rate as high as 55%. The bipartisan Death Tax Repeal Permanency Act would permanently extend death tax repeal beyond 2010. The legislation is identical to H.R. 8 from the previous Congress, which passed with a bipartisan 272-162 margin of support.
Aside from the issue of fundamental fairness, there are a host of economic and tax policy reasons why Congress should act to permanently repeal the federal death tax. To name a few:
· The death tax is a job killer. One study estimates that between 175,000 and 250,000 potential jobs are lost each year as a result of the death tax.
· The death tax is inefficient. Small businesses and family farms must divert resources from productive uses to engage in financial planning designed solely to avoid punitive taxation. These resources would be better used growing our economy.
· The death tax discourages savings and investment. The threat of a 45% tax discourages continued investment in a family business or farm operation. Not only is this a perverse incentive, it punishes a lifetime of success.
Prominent organizations representing the interests of small business and family farms, such as
the American Farm Bureau Federation, Associated Builders and Contractors, the National Association of Manufacturers and the Newspaper Association of America have endorsed the Hulshof-Cramer bill.