Monday, October 9, 2017

Kill the Death Tax!



Phil Gramm writes in the Wall Street Journal:
Americans work their whole lives, pay taxes on every penny they earn, build a farm, a business or an estate—and when they die, the government takes another 40% of everything they have accumulated. To escape this fate, the most talented people in our society squander massive amounts of time and resources trying to beat the death tax. The very rich often succeed, but at what cost?

Because of the death tax, older investors hold assets that they would like to sell, keeping them from buyers who could put them to better use. They know that if they sell the farm or business, pay the capital-gains tax and then die, they will end up paying out some two-thirds of the value of their life’s work to the government.

How many baby boomers who retire early and squander their accumulated wealth would continue to work, create and accumulate if government did not prevent them from transferring the benefits of their efforts to their family? Comparing the estimated static cost of repealing the death tax with the potential economic benefits from its repeal, it seems clear that repealing the death tax is one of the most cost-effective pro-growth tax reform policies.

One has to marvel at how anybody can find it difficult to defend repealing the death tax. Everything about the tax is wrong and the economics of repealing it are right.

2 comments:

  1. Even when statists are right, they're wrong. Gramm focuses on his perception of costs and benefits, but the real issue, which he does not mention, is that this tax, like any other, rejects the concept of private property. Arguing about costs and benefits only leads to the battle of the studies, debates about who can best bear the costs and who most needs the benefits, or what government needs to carry out its objectives, etc. But they're all besides the point if individual sovereignty is to be respected.

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  2. you got it all reversed they shouldn't tax labor/wages and when you die the government takes 55%

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