Should Massachusetts have an estate tax — which critics call the Death Tax?
The Massachusetts Fiscal Alliance does not think so.
On Wednesday, the Joint Committee on Revenue in the Massachusetts Legislature heard testimony on a handful of revenue-related bills. Hearings were held for a pair of bills that would eliminate the estate tax: Massachusetts Senate Bill 1862 filed by state Senator Ryan Fattman (R-Sutton) and Massachusetts Senate Bill 1942 filed by state Senator Patrick O’Connor (R-Weymouth).
Both of the bills are one sentence long and would repeal Chapter 65C of Massachusetts General Laws.
The Massachusetts Fiscal Alliance offered written testimony to accompany Fattman’s bill.
Here is the written statement that Massachusetts Fiscal Alliance spokesman Paul Craney submitted for the hearing Wednesday, January 12, in part:
The only way to attract more people to migrate to Massachusetts is by creating a business and resident friendly tax climate and the only way to keep people here is by abolishing the estate tax. The estate tax tears apart families, businesses, and farms. It cools off charitable giving. It absolutely causes people, their families, and their wealth to leave our state. By Massachusetts insisting that it keep the country’s most aggressive tax, it’s skipping over the dollar to collect a dime.
Massachusetts farmers are not typically thought of as millionaires but the state’s estate tax treats them that way. The oldest business in Massachusetts is a farm. Farms often sell off land in order to pay the estate tax and keep the farm in the family. Massachusetts once had a thriving dairy farm industry and now the state only has one organic dairy farm left. For our state’s robust cranberry farmers, we cannot let their fate be the same fate of our dairy farmers. If our state wants to promote agriculture and family farms, it must abolish the estate tax.
The Massachusetts state estate tax kicks in when someone transfers assets in Massachusetts worth more than $1 million to someone else (such as children) after death. That’s far less than the federal government’s estate tax exemption, which covers assets worth less than about $12 million.
Supporters of the estate tax argue that it’s a revenue generator and that it reduces income inequality, according to the Brookings Institute. They argue that it’s a tax on the wealthy and the money could be better used on the less fortunate.
Massachusetts is one of 17 states that has either an inheritance tax or an estate tax.
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