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Townhall
Finance...
Taxing
Death
by Jeff
Carter
March 28, 2012
Doesn’t the
government get enough during your lifetime? I understand the initial
sentiment
behind the death tax. It was put in place to try and stop dynasties
from
forming. Advocates looked at generational wealth in Europe and wanted
each
generation to be put at the same starting line.
But, trying
to be “fair” never works. The Koch brothers kids will always have
advantages
over mine. The great thing about the US is it doesn’t matter. My kids
can be
just as successful as the Koch kids if they create something.
Did the
creator of Spanx come from a silver spoon background? No. She went to
Florida
State and was the daughter of an artist and lawyer.
The problem
is, you will never put anyone at the same starting line with anyone
else.
That’s why the Constitution and Bill of Rights read as they do. Every
human has
“inalienable rights”. It doesn’t mean Sam and Joe start the human race
with
exactly the same amount of assets. Life isn’t a board game.
States are
beginning to understand this. Citizens are leaving their state to avoid
the
tax. The other problem they are having is as one generation dies, the
next is
being forced to liquidate productive businesses to pay the death tax.
This
hurts local economies.
WSJ:
The
Tennessee tax really does cause the rich to flee. The authors found
that in
2010 Florida had nearly twice as many federal tax returns with taxable
estates
(per 100,000 population) as did Tennessee. The average estate is also
larger in
Florida—$7.4 million versus $4.4 million in Tennessee.
There is a
reason they call Florida “God’s waiting room.”
The tax has
been useless at avoiding the creation of dynasties. Anyone ever wonder
how Joe
Kennedy made a boatload of money and the third,fourth and fifth
generations of
his estate don’t seem to have a problem with money at all? Wealthy
people hire
really good tax and insurance guys to help them avoid the death tax
problem.
Then they die in the correct state.
It’s hard
to build a fortune. Why should the government be entitled to a piece of
it?
The Wall
Street Journal has a great in depth editorial on the issue this
morning. You
ought to read it. Along with death taxes, I would advocate repealing
dividend
taxes and even a lot of corporate taxes since corporation never pay
them
anyway. They either avoid them, or aggregate them. Consumers always pay
in the
end.
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and other columns at Townhall Finance
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