- The Washington Times - Thursday, July 13, 2000

Not long after a veto-proof majority of the U.S. House of Representatives gave its overwhelming support to bipartisan legislation to repeal the onerous death tax last month, pro-death-tax forces quickly dusted off their old propaganda machines and frantically tried to restart those relics of class-warfare battles past.

"Tax cut for the rich," came the predictable cry.

"A windfall for the wealthiest Americans," coughed the antiquated machine.

Truth is, the old rhetoric that has sputtered from the propaganda machine since the House gave such surprisingly strong support to the death-tax repeal is almost as out-of-date and unfair as the Depression-era tax itself.

The rhetorical nugget most favored by the opponents of death-tax relief seems to be a statistical claim that only 2 percent of Americans would benefit from the death-tax repeal. Once again, the propaganda machine attempts to mislead the media and the public by taking facts out of context and not telling the whole story.

While the families of 2 percent of Americans directly pay the death tax each year, there are many more that are affected. Many sell their businesses before death to spare their children the 55 percent death tax and pay the lower capital-gain taxes instead. There are even more folks who pay tens or hundreds of thousands of dollars each year in death-tax compliance costs, life-insurance premiums and legal fees. And let us not forget about the employees who lose their jobs when small businesses are forced out of business and sold to pay death-tax bills. These folks are all hurt by the punitive death tax, even if they aren't included in a misleading government statistic.

While death-tax opponents hide behind their propaganda machine, they should be talking to real people like Mark Sincavage. Mr. Sincavage is an NFIB member and owner of the four-employee SIDE Corp., a small land excavation and development business in rural Monroe County, Penn.

Mr. Sincavage is in the process of selling a large part of his business' property just to pay death-tax bills after the passing of his parents. Although he is an excellent businessman, Mr. Sincavage is no Bill Gates when it comes to the size of the bottom line.

He doesn't have billions, millions, or even hundreds of thousands of dollars in cash waiting in bank accounts to pay the government. Still, his business has been milked of more than $600,000 in cash just to pay death taxes and compliance costs like legal fees. Of course, that's after his family had already dutifully paid income taxes, capital-gains taxes, property taxes and payroll taxes on the business for more than 35 years.

Then there's Brad Eiffert of Boone County Lumber in Columbia, Mo. Brad's family pays $36,000 every year in life-insurance premiums just so they'll be covered when a death-tax bill arrives someday. He'll only be included in the 2 percent statistic for one year when his father passes away, but he is already being robbed of money every single year that could be used to expand his business, create new jobs or send his children to college someday.

NFIB represents real small-business owners who are hamstrung by the death tax every day. That's why we co-founded the Family Business Estate Tax Coalition five years ago, and have been on the front lines fighting for a repeal ever since.

The American Dream holds that if we work hard, pay our bills and obey the law, we will do well for ourselves and hopefully our children will be a little better off than we were when we started. The death tax turns that American Dream into a nightmare for many small-business owners at an extremely stressful and personal time in their lives.

The punitive nature of the death tax, both before and after a business owner's death, explains why small business is so supportive of a total repeal. Just last month, small-business owners who served as delegates to the 2000 Congressional Small Business Summit named the repeal of the death tax their No. 1 short-term tax goal. Moreover, the results of a 1999 survey sent to all 600,000 members of NFIB showed that nearly 9 out of 10 (89 percent) support complete repeal of the death tax.

More than 270 members of the House of Representatives heeded these concerns when they voted to help the small, family-owned businesses in their home districts move closer to overcoming this final, unfair insult from Washington. Now it is time for senators from both sides of the aisle to keep the bipartisan momentum growing and swiftly send a repeal of the dreaded death tax to the president's desk. Every step forward for small business this year could mark next year's starting line, and could put small family businesses one step closer to recapturing the American Dream.



Jack Faris is president of the National Federation of Independent Business (NFIB), the nation's largest small-business advocacy group.

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