Studies: Estate Tax is Bad for Jobs, Economy
Two new studies have come to the same conclusion– the estate tax is a jobs and economy killer.
Some 1.5 million new jobs would be added in the small business sector at no cost to the Treasury or taxpayers by repealing the estate tax, according to the American Family Business Foundation However, if the tax is allowed to snap back to its scheduled rate in 2011, as many as 500,000 jobs will be lost, one study shows.
A separate study by the Institute for Research on the Economics of Taxation found that ending the estate tax would add $119 billion to the GDP and boost labor income by $79 billion.
Under current law, the estate tax is assessed at a 45% rate on individual estates valued at more than $3.5 million and $7 million for couples. The tax will expire in 2010, but will return in 2011 at a rate of 55% on all estates valued at more than $1 million.
President Obama has said that he wants to keep the estate tax at 45%, a decision that would harm small business owners such as U.S. Chamber member Eugene Sukup, founder of Sukup Manufacturing Co. in Sheffield, Iowa. The 80-year-old started his grain bin manufacturing company 46 years ago and plans to pass the business down to his two sons. But, Sukup says if he and his wife died tomorrow, his sons would get a tax bill for $15 to $20 million, which would force them to sell off the business to pay the tax. "I always invested the profits back into my business and that might have been part of the problem–we didn't invest in lawyers."
Read the studies at www.nodeathtax.org