Whining about the estate tax

From the Seattle P-I, we get this lovely quote:

"I would support a higher sales tax, even an income tax in this state, rather than having a death tax installed," said Don Root, who wants his sons to carry on his Seattle-based manufacturing and design company after he dies.

Reinstating an estate tax at the same time the federal government is poised to abolish it would cause successful Washington businesses to leave the state, taking a lot of good jobs with them, said Root, whose company employs roughly 450 people in Washington.

Don Root is complaining about the Governor's proposed budget, which reinstates a large chunk of the estate tax that was wiped out by a recent Supreme Court ruling.

Even though Washington has had an estate tax since 1901, Don Root claims that it's enough to drive his business out of state. But David Goldstein of HorsesAss.org has some questions for Mr. Root:

Washington heirs have been paying an estate tax for 104 years – and on much smaller estates than proposed in the new budget – but now suddenly, because the tax lapsed for two months, a new-found class consciousness is going to drive the wealthy out of state? Was Root planning to move his business out of state before the February ruling? If not, why, and if so, has anything really changed? Is anybody actually suggesting that our estate tax has been driving jobs out of state since 1901?

This is not a new tax. It is a tax that we have been levying for over a century, and as William Gates Sr. points out, it is an extremely fair tax.

I could have written a short conclusion to all of this, but for some reason, David Goldstein said exactly what I wanted to say. So rather than rephrase, here's his conclusion below, my thoughts exactly:

I’m not going to argue that an estate tax will never force heirs to sell off a family business… perhaps it occasionally does. But when our highly regressive tax structure is so cruelly unfair to middle- and lower-income households, I find it incredible to think that we should shift even more tax burden onto working families because a handful of multi-millionaires think an estate tax is unfair.

I’m not sure what’s more offensive: the selfish efforts to secure yet another tax break for the wealthy, or the bogus and insulting economic threats with which they are trying to sell it.

There you go. There's no doubt that Washington State has a regressive tax structure. But the estate tax is one of the things that helps balance out the sales tax and the property tax, both of which fall heaviest on middle and lower income families.