Death Tax Newsletter

Issue #10 —  February 23, 2000

To: Pacific Northwest Family Owned Daily Newspapers

cc:

HOUSE MAJORITY LEADER CALLS FOR ACTION ON DEATH TAX

Momentum for repeal continues to grow in Congress. In a February 18 memo to House Republicans, Majority Leader Dick Armey emphasized the need to address the death tax, saying, "Later this year, weÍll move to end another blatant unfairness in the tax code: the Death Tax. This is a tax that devastates family farms and small businesses and inserts the IRS into funeral planning. Here again the message is clear: ItÍs wrong for the government to steal the legacy two parents have worked so hard to give their children."

DEATH TAX RECEIVES NEWS COVERAGE AS NEW SESSION BEGINS

Both USA Today (Jan. 24) and The Wall Street Journal (Feb. 2) recently ran substantial pieces on the effort to repeal the death tax. Such coverage is powerful in its ability to further educate the public on the problem, and to bring greater congressional focus.

CONGRESSIONAL ALLY TAKES ON LIFE INSURANCE

U.S. Congresswoman Jennifer Dunn (R-WA), a leader on the effort to repeal the death tax has urged the Association of Advanced Life Underwriting to alter its opposition to repeal. In a letter (see attached) jointly signed by Senator Paul Coverdale (R-GA), Ms. Dunn tells the life insurers that their opposition to repeal "seems contrary to your membersÍ fiduciary responsibilities to their clients." Estate tax attorney Harold Apolinsky suggested that the life insurersÍ opposition to death tax repeal "would be like having the oncologists oppose a cure for cancer". Unthinkable. Those having relationships with life insurance agents are encouraged to ask them to support efforts to eliminate this devastating tax.

PRESIDENTIAL CANDIDATES CONSIDER DEATH TAX

An indication of the progress that has been made in the effort to eliminate the death tax is the attention the issue is receiving from presidential hopefuls. Most notably, George W. Bush has proposed elimination of the tax through rate reduction (the Dunn-Tanner approach) in his economic plan. Unfortunately, Republican candidate John McCain is proposing only to raise the unified credit to $5 million. While this approach does exempt some individuals and small businesses from having to pay the tax, it does not address the fundamental problem of flawed tax policy, does not eliminate the need for costly and inefficient estate tax planning, and does little to prevent the liquidation of a larger, capital intensive family business. To date, neither of the Democratic candidates for the presidency has endorsed repeal. However, the absence of criticism by Democratic candidates of efforts to repeal the death tax may indicate the candidatesÍ understanding of the remarkable level of popular support for the elimination of the death tax (polls vary from 70-90%). Death tax coalition members have been working with policy advisors to the Democratic candidates to educate them on the need and support for repeal.

DC EVENT TO CALL FOR REPEAL

The third annual death tax summit will be held in Washington, D.C., Tuesday, May 23, 2000. The summit will be hosted by The Seattle Times, together with three other family-held businesses from various locations throughout the country. It will focus on the devastating impacts of the death tax on independent business and the communities they serve. The daylong event will begin with briefings on studies supporting repeal and presentations from members of Congress, and is scheduled to be held in the Democratic Club as a way of emphasizing the nonpartisan nature of the issue. Business owners from throughout the country will be invited to join with the many D.C. based groups who are working to repeal the death tax and make calls on members of Congress, asking them to support family business and repeal the death tax. The day will wrap up with an informal reception, giving business owners and groups working this issue full-time in Washington the opportunity to discuss the dayÍs events. Watch for more information on the summit, or call Jill Mackie (206) 464-2028, with questions.

GORTON CO-SPONSORS DEATH TAX REPEAL LEGISLATION

U.S. Senator Slade Gorton (R-WA) has joined other northwestern senators in calling for the elimination of the death tax. Recently signing on to S.1128 (the Kyl-Kerrey Bill), Gorton joins Senators Wyden (D-OR) and Crapo (R-ID) in supporting this critical legislation. Senator Smith (R-OR) has expressed support for repeal by signing on to alternate legislation, S.56, also calling for repeal. Other Northwestern senators continue to need education on the devastating impacts of the death tax on family businesses. Senators Murray (D-WA) and Craig (R-ID) need to hear from constituents and be encouraged to support family businesses by co-sponsoring S.1128.

Did You Know?

• The death tax brings in less than 1.1 percent of total federal revenues.
• And, it is estimated it costs the government 65 cents of every dollar raised for enforcement and compliance.
• The death tax is a jobs issue.
• Repeal of the tax would result in 145,000 new jobs over the first 9 years of repeal.
• And that doesn't include the countless jobs that would be saved if the death tax didn't force 70% of family and small businesses to liquidate or sell out after only one generation.
• 99% of all private businesses have fewer than 500 employees. This represents 50% of all private sector jobs which generate 50% of all revenue.
• 77% of the American voters polled by the 60 Plus Association indicated that they would be "more likely" to vote for their member of Congress if he or she voted to eliminate the death tax.

Please e-mail us with your comments, death tax horror stories and suggestions on-line at feedback@deathtax.com.

This Web site was created and maintained by The Seattle Times Company. The Seattle Times is one of the last family owned and operated metropolitan newspapers left in America. For more information see Resources.