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INNOVATION
& DESIGN Home Page Architecture Brand Equity Auto Design Game Room SMALLBIZ Smart Answers Success Stories Today's Tip INVESTING Investing: Europe Annual Reports BW 50 S&P Picks & Pans Stock Screeners Free S&P Stock Report SCOREBOARDS Hot Growth 100 Mutual Funds Info Tech 100 S&P 500 B-SCHOOLS Undergrad Programs MBA Blogs MBA Profiles MBA Rankings Who's Hiring Grads | | SEPTEMBER 1, 2000 TAXES The Death Tax Survives a Close Call Clinton may have vetoed its repeal, but small-biz lobbyists vow to keep the issue alive during Election 2000
While there's little chance Congress will override the Aug. 31 veto, small-business advocates and antitax groups promise to press on in their battle to end the tax. "This is the crown jewel of small-business tax reform," says Giovanni Coratolo, a U.S. Chamber of Commerce policy director. WHO PAYS? Each year, the estate tax -- dubbed the death tax by opponents -- affects about 54,000 families, or 2% of the estates passed on annually in the U.S. Estates valued at $675,000 or less are exempt from the tax. And the estates of small-business owners and farmers may qualify for even larger exemptions, raising the tax's threshold for them to $1.3 million. Clinton, in a speech following his veto, said a repeal would disproportionately benefit the rich, while making it more difficult to reduce the national debt and shore up Medicare. Even though it affects about 54,000 families, half of all the money brought in by the estate tax last year was from just 3,000 estates. Nonetheless, the issue has clearly struck a chord with a wide swath of entrepreneurs. "This is just an un-American idea," says Jim Hirni, a spokesman for the National Federation of Independent Business, a conservative lobbying group representing 600,000 members. "The only way to guarantee that you won't have to pay the tax is to sell off your business or not build up your business," he adds. PUBLIC ENEMY NO. 1. Getting rid of the tax is the No. 1 priority of members of the National Association of Manufacturers. In a survey of the group this fall, respondents claim that repealing the tax would have a significant impact on their ability to grow, says Dorothy Coleman, the organization's vice-president for tax policy. The NFIB plans to keep the issue alive by faxing and e-mailing its members throughout the fall, urging them to vote Republican. Other groups, such as Americans for Tax Reform, plan to publicize how congressional members voted on the legislation. The National Association of Manufacturers will continue its lobbying efforts in Washington. And the Chamber of Commerce promises to try to pin down the actual number of jobs lost because of having the estate tax. The death tax clearly has a price on its head.  By Julie Fields  | | |
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