U.S. Sen. John Thune (R-S.D.), member of the tax-writing Senate Finance Committee, today held a bipartisan, bicameral press conference with Sen. Chuck Grassley (R-Iowa) and Reps. Kevin Brady (R-Texas) and Sanford Bishop (D-Ga.) calling on Congress to permanently repeal the death tax. Thune’s press conference highlighted yesterday’s introduction of his Death Tax Repeal Act of 2015 and the individual stories of people impacted by the death tax. Todd Wilkinson, co-owner of Redstone Feeders near DeSmet, spoke at today’s press conference about his experience as a rancher and lawyer who has managed the estate issues of dozens of the South Dakota families dealing with the death tax.
“Imposing a tax rate as high as 40 percent on savings is not just bad for the economy, it’s unfair to families that have saved and built job-creating small businesses in their local communities,” said Thune. “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. This legislation will finally give farmers, ranchers and family business owners the peace of mind of knowing that they no longer have to spend substantial sums on planning to minimize their death tax liability. I believe there is now a majority in both the House and the Senate who agree with us that the death tax punishes a lifetime of hard work and I hope to see movement in both chambers on this legislation this year.”
The death tax would impose a tax rate as high as 40 percent on family businesses, farms, and ranches, hurting economic growth by discouraging savings and small business development. Based on U.S. Department of Agriculture statistics on cropland values, roughly one-third of South Dakota farms remain vulnerable to the death tax. Many studies, including one from the Joint Economic Committee, indicate that ending the estate tax would actually increase overall federal tax revenue by encouraging more investment. And according to a study by former CBO Director Douglas Holtz-Eakin, repealing the death tax would create 1.5 million additional small business jobs and would shave almost a percentage point off the unemployment rate.
Thune also introduced an amendment to the Senate’s Fiscal Year 2016 Budget Resolution to create a deficit neutral reserve fund to eliminate the federal estate tax, or death tax. The Senate is expected to vote on Thune’s amendment later today.
The National Black Chamber of Commerce’s Harry Alford, the 60 Plus Association’s James Martin, Reliable Contracting’s Patricia Baldwin, and the South Dakota Cattleman’s Association’s Todd Wilkinson also participated in today’s press conference.