Like many local farmers and ranchers, I was among those who flocked to Dakota Fest yesterday to listen to a debate from three candidates vying for South Dakota's lone House of Representative seat in Washington, D.C. The debate featured Republican Kristi Noem, Independent Thomas Marking, and the current seat-holder, Democrat Stephanie Herseth-Sandlin. The debate ventured into hot topics like health care, bio-fuels and the estate tax.
The leading ladies in the debate, Noem and Herseth-Sandlin, duked it out on all issues, but one area where they had strong opposing positions was on the death tax. Of course, this isn't an isolated issue to just South Dakotans. The estate tax affects all farming and ranching families across the country.
Noem said that she would support a complete repeal of the estate tax.
"The estate tax is extremely detrimental to farmers, ranchers and small business owners. My dad passed away in an accident when he was 49, and in order for us to protect the original quarter of land, we had to take out a 10-year loan to pay the government. I'm a fourth generation farmer, and I understand the importance of maintaining farms to a certain size, so we can cash-flow the operation. The estate tax puts farming and ranching land at risk, land that has been in the family for generations. We can't let families be taxed off their farms."
"I'm open to a repeal of the estate tax, if the country could afford it. I don't want our farming and ranching families to suffer from this tax. We need to lower the basis to protect small operations. Anyone who says they care about paying back our national debt, yet calls for the repeal of the estate tax, is a hypocrite. It's important to reform the estate tax, but we can't lose the dollars we gain from the wealthiest estates in the country."
For those of us in agriculture, we can sympathize with families who have had difficult times paying off the estate tax in conjunction with the tragic time of losing a loved one. Looking at all sides of the coin, what would your solution be on the estate tax? If you were in the position to decide, would you reform the current tax to reap dollars from multi-million dollar operations, or would you repeal the estate tax to protect family farms? I'm looking for a good debate from the BEEF Daily readers on this topic. Leave your thoughts in the comments section below, and let the conversation begin!
In 2010, there is no estate tax thanks to the reform law passed in 2001, but the exemption amount reverts back to an exemption of only $1 million and a taxable rate of 55% in 2011. Some have called for indexing the estate-tax exemption to inflation. BEEF magazine devoted an entire issue to estate planning in spring 2007. See those articles here.