Virginia must eradicate its death tax once and for all this year

David W. Lee
Harrisonburg Daily News-Record


Few things irk small-business owners more than the political football our legislators are playing with our hard-earned assets.

Today, in the Special Session being held to adopt a budget and to address our transportation challenges, the House and Senate are playing a no-win game of cat and mouse. One of their chips in this coy contest is a bill that has the overwhelming support of Virginians full repeal of the state's death tax.

Also known as the estate tax, the death tax is government's most profane and disrespectful act against its citizens.

Here's what your family can expect at your passing, if you've worked hard to build up your tools and equipment and train employees to where they can earn a good salary: Shortly after your death, our federal and state governments come into your home and business. To many small-business owners, it feels like looting, as a government official takes an inventory of your personal property.

Don't get me wrong I embrace paying my fair share of taxes. But this double tax on family-owned businesses and farms shows how bold our government has become in its lust for cash to fund many of its unconditional programs.

Rather than allow the transfer of assets from deceased family member to family and maintain the economic stability of that company, the government has no qualms selling off assets to furnish its excesses. This can put employees out of work, often at an age when it can be difficult to find employment at a salary close to their current level.

Instead of protecting the goose that lays the golden egg, our government chooses to prepare the goose for its next feast.

The unintended consequences of the death tax can be devastating. Too often, the levy triggers job losses as small businesses disband, as well as the breakup of close relationships, many of which have existed for generations. Additionally, farmers who cannot afford the cost of estate planning sometimes must sell some or all of their farmland, which can lead to urban sprawl.

The legislators now in Special Session know how Virginians feel about the death tax. They know more than 30 other states have done the right thing by eliminating their versions of the death tax, and that Virginians want the same result. They've seen the 2002 poll that shows 82 percent of Virginians support repeal of the death tax.

They also recognize full repeal of this unfair tax has bipartisan support. In 2003, more than two-thirds of the legislature voted to repeal the death tax before Gov. Warner vetoed it. This year, in bipartisan fashion the House of Delegates voted 93-7 for full repeal of the death tax, while the Senate Finance Committee voted 14-1 for repeal.

Senators and delegates understand support for repeal is strong across the board. They know the coalition Virginians for Death Tax Repeal counts 60 members, including the Virginia Farm Bureau Federation, Virginia Retail Merchants Association and Virginia chapter of the National Federation of Independent Business. Proponents of full repeal who have been active in Virginia include the National Black Chamber of Commerce, Black Entertainment Chairman and CEO Robert Johnson, Women Impacting Public Policy, and the National Association of Women Business Owners.

Our elected officials understand the death tax is not only bad public policy but also expensive. Family-owned businesses usually cannot afford to hire an army of lawyers and accountants to do proper estate planning, and the tax encourages Virginia's wealthiest to relocate to states without a death tax like Florida, Texas, California and West Virginia. This hurts Virginia in the long run.

So what's holding up our legislators? Unfortunately, politicians view this session more as a poker match than an honest debate on public policy that matters to you and me. The media focuses on their bickering over transportation and the budget, and important issues like repeal of the death tax fall to the wayside.

Believe it or not, you can do something about this. While our legislators posture and occasionally take a peak from their trenches, take the opportunity to let them know how you feel. Elected officials know they can break sticks but not bundles.

Tell them to get to work on the budget and transportation, but more importantly, tell them not to hold full repeal of the death tax hostage. Tell Gov. Tim Kaine, who supports repeal of the death tax, to lead on this issue. Tell them all, once and for all, let's fully repeal the death tax and ensure greater fairness is restored to our tax code.

David Lee is president of Lee & Associates, a commercial real estate brokerage firm in Harrisonburg, and member of the National Federation of Independent Business.