While family farms and businesses could use more stability in the estate tax, they should be wary of proposals that make big cuts in the tax, writes one rural columnist. "Some are pushing for raising the exemption to $10 million for couples ($5 million per spouse) and dropping the tax rate on the largest estates to 35 percent. Others would repeal the tax entirely on farmland,"writes Chuck Hassebrook of the Center for Rural Affairs. "Each of these proposals is overly generous to wealthy heirs and puts farmers, ranchers and small business people who must earn their way at a competitive disadvantage. The overwhelming majority of family farms and businesses would be hurt, not helped."
Nine years ago Congress and President Bush launched a gradual reduction in the estate tax, which culminated in its scheduled full repeal this year. "But there was a catch," Hassebrook writes. "Congress could not pay for permanent repeal. So next year the estate tax returns to its 2002 levels – with the first $2 million of an estate exempt for married couples ($1 million per person) and a 55 percent tax on the largest estates." Farmers who would inherit a tax-free $10 million estate would have big advantage over those who receive no inheritance or a modest one.
"The estate tax helps level the playing field between those whose success is based on being born into the right family and those who must earn success through hard work, brains and determination," Hassebrook writes. The estate tax is all the more important when one considers wealth is concentrating in the U.S. with 66 percent of the income growth between 2001 and 2007 going to the top 1 percent, the center writes. "A big reduction in the tax on large estates would add fuel to the fire, undermining the idea of a level playing field at the core of America and hurting family-size farms, ranches and businesses," Hassebrook concludes. (Read more)
No comments:
Post a Comment