By Peter Urban
Stephens Washington Bureau
WASHINGTON — U.S. Rep. Mike Ross, D-Prescott, joined a small band of pro-agriculture legislators today in introducing legislation to eliminate the federal estate tax.
Ross said the so-called “death tax” should be taken off the books because it is bad policy and a major worry to family farmers and small business owners.
“I’ve got a lot of farm families and small business owners that are very concerned about what happens when they die,” he said.
Ross introduced the legislation with Reps. Kevin Brady, R-Texas, Dan Boren, D-Okla., Kristi Noem, R-S.D., and Devin Nunes, R-Ca.
Congress approved legislation in December that provided a $5 million per person exemption from the estate tax and set the top tax rate at 35 percent for 2011 and 2012. The highest previous exemption was $3.5 million.
A Department of Agriculture economic report estimated that nationwide about 1,100 of the 38,234 “farm estates” in 2009 had assets in excess of $3.5 million. After deductions, only about 550 would owe any estate tax.
Despite the higher exemption for 2011, Ross said the estate tax poses a serious concern for farmers and that “time and time again” he has heard of families being unable to pass on a family farm or small business to the next generation because of the tax burden.
“It doesn’t make sense to be taxed again when we die,” he said. “And it is unfair and punishes those Americans who work hard over their lives.”
Bob Stallman, president of the American Farm Bureau Federation, said the “on-again-off-again nature of estate law” makes it difficult for farmers and ranchers to plan for the transfer of a family business from one generation to the next.
“There is a real need for permanent estate tax elimination,” he said.
Brady said discussions have begun with the chairman of the House Ways and Means Committee to move the bill forward.
A major hurdle for the bill would likely come in the Senate over how to offset revenues lost by its repeal, Brady said. The clash would be over cutting spending or raising taxes elsewhere.
“So that will be a challenge,” Brady said.
