Virginia Secretary of Finance Jody Wagner released new revenue figures yesterday showing Virginia's economy is strong and able to absorb repeal of the death tax for family-owned businesses.

As time marches on, state tax collections continue to grow at amazing levels. General Fund tax collections last month pushed growth in the state budget to 9.4 percent year to date versus last year.

In other words, Virginia has collected over $1 Billion more this year as of the end of April as it did at the same time last year.

And the General Fund has grown from about $12 billion in 2003 when the General Assembly first passed legislation repealing the unfair death tax to over $18 billion in 2007.

The cost of repealing the death tax is $100 million for the second year of the state budget. Although repeal of the death tax will be meaningful tax relief for Virginia's family farmers and small businesses, it represents less than 2 cents of every NEW dollar the state has collected since 2003, making it possible without sacrificing services.

The current rate of growth in tax collections from Virginia taxpayers will lead Virginia to have our largest General Fund revenue base ever. We hope with this good news about state tax collections exceeding expectations that legislators can see their way to repeal the death tax for Virginia's small business owners and family farmers.

Some of the highlights in revenue collection released today include:

• The state has taken an additional $615 million in income taxes this year, over a nine percent increase over last year.





• An additional $255 million in corporate income taxes have been collected this year compared to last year.





• "Deeds and contracts", largely recordation taxes from the purchase of homes, have increased $114 million, or about 25% over 2005.





• Lottery profits are up $39 million over last year, or over 11% more than the state collected the same time last year.





• Sales tax collections are $72 million higher this year than last.





• Meanwhile, collections from the death tax continue to dwindle, making the unfair tax even more affordable to repeal.

If you think that Virginia can clearly afford to repeal the unfair death tax, please contact your legislators today by clicking here.

• The state has taken over half a billion dollars from families after the death of a loved one over the last four years. They are slated to take about the same amount over the next four years if the law is not repealed.





• The average cost of lifetime estate tax planning can range from $30,000 to $150,000, with expenditures on life insurance plans to protect family-owned businesses amounting to as much as $50,000 to $70,000 per year. (Source: Republican Policy Committee Report , June 2005)





• There are over 48,000 farms in Virginia. Most are family owned. And many spend thousands of dollars every year avoiding the death tax. Many likely will be sold in whole or in part to developers to help pay the death tax. To read more about how family farmers can be affected by the death tax, click here.





• The death tax can be as much as 16 percent of a family's worth. This is higher than the capital gains tax and higher than 32 other states that do not collect the tax.





• The wealthy can afford high priced lawyers and accountants to avoid the tax. Family farmers and small business owners often get stuck footing the bill for this unfair tax.





• Legislation repealing the tax for only some families and estates is unfair and will continue to burden small business owners and family farmers who hope to live more than ten years.

"Instead of protecting the goose that lays the golden egg, our government chooses to prepare the goose for its next feast."

"The unintended consequences of the death tax can be devastating. Too often, the levy triggers job losses as small businesses disband, as well as the breakup of close relationships, many of which have existed for generations. Additionally, farmers who cannot afford the cost of estate planning sometimes must sell some or all of their farmland, which can lead to urban sprawl"

- David Lee, President of Lee & Associates, a commercial real estate brokerage firm in Harrisonburg, and NFIB member (Op-ed, Daily News Record - May 2006)
Click here to read the op-ed.

"Virtually every penny he [my father] made in the business or in his other investments over the last fifteen years of his life was set aside for his heirs to pay estate taxes. This was so his business could survive and his employees' lives would not be disrupted."

- Lucy Harman, P.C. Goodloe & Sons (Legislative Testimony, November 2003)

"Protecting family-owned businesses and farms is, and should be, a top priority for state government. The last thing any of us wants to have to do is to sell or break up our business to pay the death tax."

"Eliminating this unfair tax would ensure that small family businesses will have a future for generations to come."

- Rhoda Elliott, President, Bill's Barbecue, Inc. (Op-ed, Richmond Times-Dispatch February 2006)
Click here to read the op-ed.

Last week, the House of Delegates and Senate passed legislation to address budget issues between now and June 30, 2006. This action provides modifications to the existing state budget and spends an additional $149 million or so that the state has realized over and above what was projected last December. Again, this is not a FINAL budget deal, only amending the existing budget leading up to June 30, 2006. Governor Kaine has one week to review this "caboose" budget and offer any possible vetoes or amendments to the General Assembly.

Negotiations on the main budget, the biennial budget for July 2006 June 2008, remain unclear at this point. The same eleven conferees will be working on this going forward.

Both the Senate and House versions of the budget contemplate reduction in revenue from repeal of the death tax. The House contemplates about $100 million tax cut for family farmers and small businesses by fully and completely repealing the death tax on January 1, 2007. The Senate only contemplates about a $52 million reduction in spending by cutting the death tax for select families and businesses, sometimes based on how a company is managed.

Be sure to contact your legislators and urge them to repeal Virginia's unfair death tax by clicking here.

Governor Kaine Announces Business Appreciation Week

Yesterday, Governor Tim Kaine recognized May 14-20 as Business Appreciation Week in the Commonwealth. This designation celebrates the contributions of Virginia businesses with this year's theme "Navigating Virginia's Future" acknowledging the determination of state business.

"Virginia businesses affect every aspect of our lives from job growth and quality of life to our Commonwealth's prosperity and positive business climate," said Governor Kaine. "Their success plays a vital role in keeping Virginia moving forward."

Virginians for Death Tax Repeal appreciate the Governor's recognition of the considerable role Virginia businesses, especially small business, plays in the continued strength and prosperity of the state economy. We also appreciate the support Governor Kaine has expressed for full and honest repeal of the death tax for Virginia's family farmers and small business owners. We hope that lawmakers will share this sentiment as they discuss death tax repeal during budget negotiations, considering the investment, jobs and economic growth small businesses generate each year.

To read the Governor's press release, click here.

Virginia must eradicate its death tax once and for all this year

Op-ed by David W. Lee Harrisonburg

Daily News Record

May 9, 2006

Few things irk small-business owners more than the political football our legislators are playing with our hard-earned assets.

Today, in the Special Session being held to adopt a budget and to address our transportation challenges, the House and Senate are playing a no-win game of cat and mouse. One of their chips in this coy contest is a bill that has the overwhelming support of Virginians full repeal of the state's death tax.

Also known as the estate tax, the death tax is government's most profane and disrespectful act against its citizens.

Here's what your family can expect at your passing, if you've worked hard to build up your tools and equipment and train employees to where they can earn a good salary: Shortly after your death, our federal and state governments come into your home and business. To many small-business owners, it feels like looting, as a government official takes an inventory of your personal property.

Don't get me wrong I embrace paying my fair share of taxes. But this double tax on family-owned businesses and farms shows how bold our government has become in its lust for cash to fund many of its unconditional programs.

Rather than allow the transfer of assets from deceased family member to family and maintain the economic stability of that company, the government has no qualms selling off assets to furnish its excesses. This can put employees out of work, often at an age when it can be difficult to find employment at a salary close to their current level.

Instead of protecting the goose that lays the golden egg, our government chooses to prepare the goose for its next feast.

The unintended consequences of the death tax can be devastating. Too often, the levy triggers job losses as small businesses disband, as well as the breakup of close relationships, many of which have existed for generations. Additionally, farmers who cannot afford the cost of estate planning sometimes must sell some or all of their farmland, which can lead to urban sprawl.

The legislators now in Special Session know how Virginians feel about the death tax. They know more than 30 other states have done the right thing by eliminating their versions of the death tax, and that Virginians want the same result. They've seen the 2002 poll that shows 82 percent of Virginians support repeal of the death tax.

They also recognize full repeal of this unfair tax has bipartisan support. In 2003, more than two-thirds of the legislature voted to repeal the death tax before Gov. Warner vetoed it. This year, in bipartisan fashion the House of Delegates voted 93-7 for full repeal of the death tax, while the Senate Finance Committee voted 14-1 for repeal.

Senators and delegates understand support for repeal is strong across the board. They know the coalition Virginians for Death Tax Repeal counts 60 members, including the Virginia Farm Bureau Federation, Virginia Retail Merchants Association and Virginia chapter of the National Federation of Independent Business. Proponents of full repeal who have been active in Virginia include the National Black Chamber of Commerce, Black Entertainment Chairman and CEO Robert Johnson, Women Impacting Public Policy, and the National Association of Women Business Owners.

Our elected officials understand the death tax is not only bad public policy but also expensive. Family-owned businesses usually cannot afford to hire an army of lawyers and accountants to do proper estate planning, and the tax encourages Virginia's wealthiest to relocate to states without a death tax like Florida, Texas, California and West Virginia. This hurts Virginia in the long run.

So what's holding up our legislators? Unfortunately, politicians view this session more as a poker match than an honest debate on public policy that matters to you and me. The media focuses on their bickering over transportation and the budget, and important issues like repeal of the death tax fall to the wayside.

Believe it or not, you can do something about this. While our legislators posture and occasionally take a peak from their trenches, take the opportunity to let them know how you feel. Elected officials know they can break sticks but not bundles.

Tell them to get to work on the budget and transportation, but more importantly, tell them not to hold full repeal of the death tax hostage. Tell Gov. Tim Kaine, who supports repeal of the death tax, to lead on this issue. Tell them all, once and for all, let's fully repeal the death tax and ensure greater fairness is restored to our tax code.

David Lee is president of Lee & Associates, a commercial real estate brokerage firm in Harrisonburg, and member of the National Federation of Independent Business.

Thank you for the comments you've sent in. Since the beginning of the regular session, we have received many letters, calls and emails of encouragement from individuals and families in favor of ongoing efforts to repeal the death tax. As well, we have received considerable information on what legislators are saying in response to your emails and letters to them in support of eliminating the death tax this year!

In fact, we have also heard from family business owners who are considering leaving Virginia due to the state death tax. This is an unfortunate consequence Virginia will continue to face if legislators fail to repeal this unfair tax.

Please keep providing us your insight on this issue. As grassroots leaders in this effort, your support is invaluable.

Please forward this message to your email list and urge your friends, neighbors and business colleagues to contact their legislators and urge them to repeal Virginia's death tax.

Thanks again for your continued support of efforts to repeal this unfair tax.