Missouri Rep. Sam Graves (R-6), as behooves the offspring of a farm family, couches his defense of the provision of the GOP tax-cut-for-the-rich bill that would repeal the estate tax in terms of farmers. But before I get to that defense, it’s important to note that Graves seems to be a little confused about the meaning of words. He somehow thinks that the estate tax amounts to double taxation on the person who dies – rather than a one-time tax levied on the folks receiving a hefty gift they almost surely did not work for or earn. And BTW, big gifts are taxable even when the giver isn’t dead.
But he’s right about where to focus his defense of eliminating this particular rich folks’ goodie. Nobody will cry too hard if the Trump offspring someday have to pay estate taxes on what Daddy Trump represents as his billions. We all know that they’ll continue to live big no matter what – especially given the ways that Daddy is monetizing his time in the White House. But Graves knows that if his rural farming constituency thinks that the tax hurts small family farmers who receive their inheritance in the form of land, etc. rather than ready cash, they might be willing to foot the cost for Ivanka, Don Jr. and Eric to buy a few more yachts, which is why he “gravely” (get it?) pronouces:
Farmers are hit especially hard by the death tax. After a lifetime of acquiring land and equipment to help provide food for the world, farmers are subjected to an additional tax on their estate when they die. The real effect of this double, and sometimes triple, taxation is felt by the late farmer’s family.
While many folks receive an inheritance in the form of a check or stocks and bonds, the family farmer passes on his life’s work and ensures that farming continues as a way of life in North Missouri and around the country.
It’s no wonder that our kids and grandkids aren’t choosing to farm when they grow up. It’s expensive enough to get a farming operation off the ground, much less keep it in the family after giving part of it to the government.
Could get a farmer all fired up and maybe even willing to overlook all the ways that the GOP tax plans will shaft the middle class – even middle class farmers. Except for one thing: Graves is playing fast and loose with the facts. According to the Center for Budget and Policy Priorities (CBPP), “only 50 small farm and small business estates in the entire country will pay any estate tax in 2017 […] and they’ll owe less than 6 percent of their value in tax, on average.” Nor, as the CBPP further notes, will paying that tax force farming heirs to sell the family farm:
The estate tax affects so few small farms and businesses because the first $5.49 million of assets per person ($10.98 million per couple) are entirely exempt from it. Moreover, most farmers and business owners with estates large enough to owe the tax have sufficient liquid assets (such as bank accounts, stocks, and bonds) to pay the tax without having to touch other assets or liquidate their farm and business, a 2005 Congressional Budget Office (CBO) study found. Today’s estate tax rules are even more generous than those CBO assumed in its analysis. Special estate tax provisions also allow estate tax filers to spread their payments over a 15-year period at low interest rates.
While doing next to nothing for family farms, repeal would provide a windfall to the wealthiest 0.2 percent of estates — the only ones large enough to pay the tax. A repeal proposal recently reintroduced in the Senate would provide the 0.2 percent of wealthiest estates with an average tax cut of more than $3 million in 2017. Roughly 330 estates worth more than $50 million would get more than $20 million apiece in tax cuts, the Joint Committee on Taxation estimates. The proposal would also cost $269 billion over the decade, expanding deficits and adding to pressure for cuts in federal programs.
I’d say that somebody ought to tell Rep Graves to get his facts straight, but there’s that part of me that wonders what the point would be. We’ve seen his colleagues spin whopper after whopper to try to sell us on a tax cuts for their donors. Is it Graves fault that the best he can do is that old swampland special, the farm estate tax canard? It may even do the job it’s designed to do. After all, for many Trump voters who believe he/she knows from whence emanates all fake news, it probably still has currency.
At least Rep. Graves isn’t resorting to claims like those made my my Representative, Ann Wagner (R-2), that raising taxes on the middle class, cutting funding to programs that benefit the middle class, while giving a big regressive tax cut to the wealthiest of the wealthy will somehow help a “single mother of two.” Of course, there’s nothing to stop an unmarried Paris Hilton clone from giving birth twice. It could even happen on a lavish country estate that qualifies as a “family” farm.