Hanger wants the estate tax repealed completely

Hanger seeks middle ground with governor on cigarette, estate tax
By BOB STUART
News Virginian
Monday, December 1, 2003


Sen. Emmett Hanger, R-Mount Solon, said Monday he welcomes Virginia Gov. Mark Warner s tax-reform plan, but hopes there is room for compromise on at least a couple of key issues.

The Warner plan offered last week includes a 1-cent-per-dollar increase in the sales tax on goods, and 1.5-cent reduction in food taxes. The plan would generate more than $1 billion in revenues over two years.

Hanger, co-chair of a legislative tax reform commission, wants his version of a cigarette tax approved, and still wants complete repeal of Virginia s estate tax.

"The governor s plan gives us a benchmark and has a number of initiatives I ve been an advocate for over a number of years, Hanger said.

The senator has concerns about Warner s cigarette tax proposal though.

Warner wants to increase the state cigarette tax from 2.5 cents - the nation s lowest - to 25 cents per pack. He proposes giving cities and counties the option to levy a tax of an additional 50 cents per pack.

Hanger is proposing increasing the tax to a maximum 30 cents per pack. He said Warner s proposal could damage Virginia s important tobacco industry.

"This tax could make it as high as 90 cents per pack and is overly punitive to the tobacco industry, Hanger said.

Kevin Hall, Warner s deputy press secretary, said the governor s proposal would offset the loss of car-tax revenue to Virginia s cities and counties.

He also said Warner has discussed his plan with tobacco-industry executives, and promises to phase the tax in over a three-year period.

"This piece of the tax reform proposal has been carefully crafted to be sensitive to their concerns, Hall said.

As for the estate tax, Hanger wants the tax repealed completely. He has maintained his stance on this issue, saying the current tax makes it difficult for family farms to be passed to the next generation.

Hall said the Warner proposal would repeal the estate tax on those estates valued at $10 million or less, and on working farms and closely held businesses.

"Very, very few estates are valued at more than $10 million, the governor s aide said.

The Warner spokesman said the governor already has met with numerous legislators about his package, and hopes for some action during next year s General Assembly.

"The legislature has studied this three times in four years without any conclusion, Hall said. "With the state s Triple A bond rating at stake and with $6 billion in cuts since we ve been in office, we hope lawmakers share our urgency that this is the time to get this done."

While many on the legislative tax reform commission are signaling surrender, Hanger will hold meetings in Richmond this week. He also plans several speaking engagements around the state.

"I m trying to sell a certain package of tax reform that has some overlaps with the governor," Hanger said.

Hanger said he is willing to support some increase in sales taxes and an additional bracket in income tax.

Contact Bob Stuart at bstuart@newsvirginian.com


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