House Repeals Estate Tax
April 04, 2001
NCPA's Bartlett Joins Black Millionaires, Others in Celebrating Repeal
WASHINGTON, DC (April 4, 2001) -- A group of black millionaires led by billionaire founder of the Black Entertainment Network, Robert L. Johnson, bought ads today in The New York Times and the Washington Post calling for abolition of the so-called death tax. As expected, the House of Representatives has approved the $192 billion dollar tax cut bill that would phase out estate taxes by 2011.
"Farmers, small business owners and newly wealthy groups, like these black millionaires, understand that the estate tax is a triple, and in some cases a fourth, level of taxation," said Bruce Bartlett, NCPA Senior Fellow. And, according to Bartlett, there are other severe economic problems with estate taxes:
- Estate tax rates are very high, starting at 37 percent on the first taxable dollar and rising to 60 percent on estates larger than $10 million, which significantly reduces the stock of capital-the ultimate source of jobs and wages for all workers.
- Estate taxes are especially costly to family-run businesses because the costs of estate planning robs their enterprises of current revenue; otherwise, their businesses must be sold at a fraction of the value just to pay estate taxes.
- Most of the white millionaires who support the estate tax don't care about struggling family businesses. Why should they?! Most of them inherited their wealth and those who didn't are known to have made extensive, albeit legal, plans for preserving their wealth from estate taxes.
Statistics from the Internal Revenue Service (1999) show that most estate taxes are paid by estates smaller than $5 million and two-thirds are paid by estates smaller than $10 million.
"Mr. Johnson and his colleagues are to be congratulated for supporting the repeal of the death tax. In fact, I look forward to a debate between his group and those white millionaires who signed an ad in The New York Times supporting the estate tax on February 8," Bartlett said. "BET, Johnson's television network, should televise it."