U.S. Senator John Thune (R-S.D.) today introduced the Death Tax Repeal Permanency Act to abolish the destructive federal death tax. Representative Kevin Brady (R-Texas) introduced identical legislation in the House of Representatives and the bill currently has over 200 bipartisan cosponsors.
“The death of a loved one should not be a taxable event,” said Thune. “The federal government has no place being in the business of forcing grieving families to pay a tax on their loved one’s life savings that has been built from income already taxed when originally earned. Sadly, this tax is often paid by selling the family farm or life-long business. Other times, employees of the family business must be laid off and payrolls are slashed in order to pay the burdensome death tax. Let’s permanently repeal this punitive tax once and for all.”
America’s family businesses and farmers were spared from the burdensome federal estate tax in 2010, but unfortunately, this was only a short reprieve. Entrepreneurs are once again subject to this punitive tax, making planning and passing on farms and businesses to the next generation even more difficult. Currently, more than 70 percent of family businesses do not survive to the second generation, and 90 percent of family businesses do not survive to the third generation.
Not only would Thune’s bill repeal the federal estate tax, but it would also repeal the generation skipping transfer (GST) tax, make permanent the maximum 35 percent gift tax rate and a $5 million lifetime gift tax exemption, and maintain the stepped-up basis provisions important to family farms and businesses.
According to a recent study by Douglas Holtz-Eakin, the former director of the non-partisan Congressional Budget Office, repealing the death tax would create 1.5 million additional small business jobs and would decrease the national unemployment rate by nearly one percent.
Cosponsors of the legislation include: Senators Marco Rubio (R-Fla.), John Boozman (R-Ark.), Kelly Ayotte (R-N.H.), John Barrasso (R-Wyo.), Roy Blunt (R-Mo.), Richard Burr (R-N.C.), Daniel Coats (R-Ind.), Tom Coburn (R-Okla.), Thad Cochran (R-Miss.), John Cornyn (R-Texas), Mike Crapo (R-Idaho), Jim DeMint (R-S.C.), Michael Enzi (R-Nev.), Charles Grassley (R-Iowa), Dean Heller (R-Nev.), John Hoeven (R-N.D.), Kay Bailey Hutchison (R-Texas), James Inhofe (R-Okla.), Johnny Isakson (R-Ga.), Mike Johanns (R-Neb.), John Kyl (R-Ariz.), Mike Lee (R-Utah), Richard Lugar (R-Ind.), John McCain (R-Ariz.), Mitch McConnell (R-Kent.), Jerry Moran (R-Kan.), Rand Paul (R-Kent.), James Risch (R-Idaho), Pat Roberts (R-Kan.), Jeff Sessions (R-Ala.), Pat Toomey (R-Pa.), David Vitter (R-La.), and Roger Wicker (R-Miss.).
Senator Thune’s legislation is supported by a wide variety of organizations, including 60 Plus Association, American Civil Rights Union, American Conservative Union, American Family Business Institute, American Farm Bureau Federation, American Grassroots Coalition, American Legislative Exchange Council, American Values, Americans for Prosperity, Americans for Tax Reform, Campaign for Liberty, Center for Individual Freedom, Center for Investors and Entrepreneurs, Competitive Enterprise Institute, Center for Law and Social Strategy (CLASS), Citizen Outreach, CitizenLink, Citizens Against Government Waste, Citizens for Limited Taxation, Club for Growth, Wine & Spirits Wholesalers of America, Concerned Women for America, ConservativeHQ.com, Eagle Forum, Forest Landowners Association, Freedom Action, Frontiers of Freedom, Heritage Action for America, Hispanic Leadership Fund, Institute for Research on the Economics of Taxation, International Sleep Products Association, Less Government, Let Freedom Ring, Log Cabin Republicans, Maryland Federation of Republican Women, Maryland Taxpayers Association, National Black Chamber of Commerce, National Cattlemen’s Beef Association, National Center for Public Policy Research, National Federation of Independent Business (NFIB), National Tax Limitation Committee, National Taxpayers Union, Regular Folks United, RenewAmerica.com, RenewAmerica.com, RightMarch.com, Service Station Dealers of America and Allied Trades, Small Business & Entrepreneurship Council, The O'Leary Report, The Petroleum Marketers Association of America, The Tire Industry Association, The U.S. Chamber of Commerce, The Weyrich Lunch, Traditional Values Coalition, and Washington, Maryland, Delaware Service Station & Automotive Repair Association.