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It's time for Virginia to bump off the death tax--once and for all
Virginia legislature--Buffy the Vampire Slayer or Dracula with Death Tax?
Date published: 2/2/2006
VIRGINIA'S legislature has a remarkable opportunity this session. With a governor in office now supporting full repeal of the state's death tax, legislators can make Virginia a better business state by driving a stake through this harmful double tax once and for all.
Collected by the government very shortly after one dies, the death tax, or estate tax, does significant harm to communities, often causing the dissolution of family-owned businesses and farms. This leads to job losses and the breakup of close relationships, many of which have existed for generations.
Additionally, farmers who cannot afford the cost of estate planning sometimes must sell all or part of their farmland--which contributes to urban sprawl.
More than 30 other states have done the right thing by eliminating their versions of the death tax, and Virginians want the same result. According to a 2002 statewide poll, 82 percent of Virginians support repeal of the death tax, while 87 percent say it's unfair Virginians must pay the tax while people from other states don't.
Full repeal of this unfair tax has bipartisan support. In 2003, more than two-thirds of the legislature voted to repeal the death tax before Gov. Warner vetoed it.
The state Senate came within two votes of overriding the veto, which was a difficult defeat for entrepreneurs and their employees across the commonwealth.
Edd Houck, a Democratic state senator from Spotsylvania, knows what the death tax does to many of his constituents and supports its full repeal--as does Gov. Kaine, who, to his credit, says he's ready to end this harmful levy.
Support also goes across demographics. Proponents of full repeal who have been active in Virginia include: the National Black Chamber of Commerce, Black Entertainment Chairman and CEO Robert Johnson, Women Impacting Public Policy, and the National Association of Women Business Owners.
The coalition Virginians for Death Tax Repeal counts 60 members, including the Virginia Farm Bureau Federation, Virginia Retail Merchants Association and Virginia chapter of the National Federation of Independent Business.
The breadth of this support is easy to understand by looking at some vital statistics. According to the Center for the Study of Taxation, nationally 70 percent of family-owned businesses fail to survive to the second generation, and 87 percent fail to get to the third generation.
Women- and minority-owned businesses are often hit the hardest. The death tax simply sends the wrong message to them and all entrepreneurs and farmers--work all your life to make a living but then pass your estate to the government rather than members of your family.
This is terribly unfair, and Virginians understand this.
The death tax not only is bad public policy, but it's also expensive. Family-owned businesses rarely can afford to hire an army of lawyers and accountants to do proper estate planning.
In addition, the tax encourages Virginia's wealthiest to relocate to other states without a death tax, like Florida, Texas, California, and West Virginia--hurting Virginia in the long run.
I encourage your readers to visit deathtaxrepeal.com and call state Sen. John Chichester, who needs to hear that this tax must go the way of other harmful public policy.
With encouragement, our senators will hopefully do the right thing and support the wishes of the vast majority of Virginians.
JOE WILSON of Fredericksburg is a member of the Leadership Council of the National Federation of Independent Business in Virginia.
Date published: 2/2/2006
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