Monday, legislation (SB 504) calling for full repeal of the Death Tax, was reported favorably out of the House Finance Committee by a vote of 21-1. A full vote by the House of Delegates will take place Wednesday, March 1.

At that point, SB 504 will likely be referred to a conference committee for consideration unless the full Senate agrees to the House amendments calling for full repeal of the death tax.

The other bill, Delegate Tata's legislation (HB 40) calling for full repeal will be heard by the Senate Finance Committee tomorrow morning at 8:30am in Senate Room B. We anticipate that an amendment will be introduced by Senator Chichester to amend HB 40 to partial repeal.

It is our hope that members of the Senate Finance Committee will realize and raise concerns surrounding the inclusion of partial repeal language, although ultimately the problems with the Senate plan will need to be ironed out in the conference committee between the House and Senate.

The Conference Committees are slated by the calendar of the General Assembly to complete their work by Monday, March 6.

Once members of the Conference Committee on death tax repeal are appointed we will provide you their contact information.(For more information on "Conference Committees", see below*).

It is important for coalition members to express their views to Senators about their concerns over partial repeal. Otherwise, these Senators may believe that they have helped the cause, even though they have not. Click here to EMAIL YOUR SENATOR TONIGHT.

Some of the more serious flaws with partial repeal include:

-Partial repeal would exhaust resources and capital from family farmers and small business owners as they hire attorneys to pursue tax avoidance policies and incur the cost of tax related insurance plans.

-Partial repeal would encourage the wealthy to buy working farmland and allow their heirs to sell it for residential and commercial development.

-Partial repeal would establish Virginia as the primary defendant of lawsuits regarding death taxes because exemption language departs radically from the federal calculation.

-Partial repeal would drain state regulatory and enforcement resources.

-Partial repeal would encourage tax flight by those with means seeking shelter in states without a death tax.

-Tax flight carries a greater consequence with impact on income tax revenue, capital investment, charitable giving and volunteerism.

-Partial repeal with a $10 million cliff means that growing businesses will suddenly be vulnerable to this tax in the coming years as they grow.

-Partial repeal clauses for "working farms" and "closely held businesses" are so narrowly drawn that not a single business in Virginia could be identified that would be affected according to the Department of Planning and Budget in 2004.

-Governor Kaine promised to phase out the death tax and conform Virginia to federal law. Amendments made to SB 504 move us further away the WRONG way from the federal law.

-Further, the Wills, Trusts and Estates Section of the Virginia Bar Association expressed concerns regarding partial repeal legislation. They stated that partial repeal is "unusual and perhaps arbitrary."

The House Republican Caucus will conduct a press conference tomorrow highlighting the Tax Reform and Relief priorities included in the House budget.

What: House Republican Caucus Press Conference

When: February 28, 2006 at 11:00 a.m.

Where: Speaker's Conference Room

6th Floor - General Assembly Building

*About Conference Committees

When the House and Senate pass different versions of the same legislation, the resolution is usually found through a Committee of Conference. The Speaker will appoint three Delegates and the Senate will appoint three Senators. It is typical for there to be two Republicans and one Democrat from each the House and the Senate. It is also customary that the patrons of the bills serve on this committee, so we expect Senator Norment and Delegate Tata to be appointed to the conference committee for these bills.

The conference committee does not "meet" typically, but members will discuss amongst themselves on the phone, via email, or in offices or in the hallways even what kind of compromise is possible.

It will be important later this week for you to email, visit or call members of the conference committee to let them know your thoughts about fully repealing the death tax.