The US House voted 240-179 on Thursday to repeal the estate tax. The measure completely repeals what farmers have come to call the “death tax.” Bill sponsor Representative Kevin Brady, R-TX, said the tax can unfairly hit entities such as small businesses and family farms. American Farm Bureau President Bob Stallman said, in a statement, “We need tax policies that help capital-intensive businesses like farms and ranches, and that don’t stand in the way of sons and daughters ready to follow the agricultural legacy of their parents.”
Tennessee farmer Brandon Whitt says the Estate Tax is double taxation for farms, “From year to year we pay taxes; and simply because a family member dies and we pass that farm on to the next generation, we now have to pay another tax. We would literally have to sell equipment or land or something at the detriment to the business in order to pay the tax. I just don’t see that being a very fair opportunity to keep our business going into the future.”
Currently, estates valued at less than $5.4 million for individuals and $10.9 million for couples are exempt, something Whitt says is unfair, “If we’re going to let one farm off the hook from paying a death tax, then we should let all farms off the hook. It’s not fair to say if you fit inside this strangely shaped box that you are exempt from the death tax, and if you happen to not fit inside this box, then you have to pay.”
Indiana Farm Bureau President Don Villwock has also been an outspoken critic of the tax, saying it is a burden on family farms and especially on the next generation trying to take over the farm. Jim Mulhern, President and CEO, National Milk Producers Federation, said in a statement, “It’s hard enough for new generations of dairy producers to establish their own farms without the prospect of the estate tax penalizing the transfer of farms between generations of family members. That’s why we support the action today in the House of Representatives to repeal the estate tax. H.R. 1105, the Death Tax Repeal Act, banishes the specter of the estate tax from the same business people that we should be encouraging to invest in the future of America’s food production.”
The vote, however is mostly symbolic since the White House has promised to veto a repeal of the tax saying the legislation would “endorse the principle that the wealthiest Americans should not have to pay tax on certain forms of income at all.” Democrats criticized the legislation as an unjustified boon to the wealthy at a cost of $269 billion to the deficit over the next decade.