06/14/2006
Small-business owners will be weighing the Senate's recent failure to pass permanent death-tax repeal when they decide whether to return their lawmakers to Washington at the polls this fall: Many senators who cast critical votes on repeal are up for reelection in November.
Long targeted by NFIB and its members, the death tax isn't just a burden for those who have to pay it. Instead, many business owners spend countless time through the life of their business trapped in paperwork, red tape and worse—tying up their capital—to plan for this burdensome tax upon their deaths, just to ensure that their business doesn't die when they do. Earlier this month, the Senate had the opportunity to take on this tax that greatly impacts small businesses and their viability by permanently repealing the death tax. The Death Tax Repeal Permanency Act of 2005 (H.R. 8) would reduce a great burden on the small-business community, as families seek to pass on their businesses from one generation to the next.
Though the legislation received strong support from small-business allies in the Senate—even garnering a bipartisan 57-vote majority—opponents blocked its progress on a procedural motion, as 41 senators prevented the Senate from even considering the legislation.
NFIB fought for the death tax to be phased out as a part of tax relief passed in 2001, but procedural rules in Congress prevented the repeal from extending beyond 2010. In a recent survey conducted by the Tax Foundation, 89 percent of small-business owners said they want full repeal of the death tax, while national polls have indicated that as much as 68 percent of the public supports its elimination. Nebraska Sen. Ben Nelson, who has supported small business on Small-Business Health Plan legislation, tax relief and reducing regulatory burdens, was also a strong ally of NFIB in the effort to repeal the death tax. Though he may face a strong challenge in his race for reelection, he worked gain the support of his colleagues in spite of significant criticism from party leadership and anti-small-business interest groups.
New Jersey Sen. Bob Menendez, just six months after being appointed to the Senate, has already distanced himself from the small-business community. Menendez is in a hotly contested race against state Sen. Tom Kean Jr., a strong advocate for repealing the death tax. Even though more than 380,000 small businesses in New Jersey will be affected by the burdens of the death tax, Menendez voted against permanent death-tax repeal.
"Recently I met with Senator Menendez's staff and let them know that this is a critical issue for the survival of my company and all thirty of my employees," said Joe Olivo, a small-business owner from Moorestown, N.J. "I was greatly disappointed that he didn't take into consideration the impact this will have on small businesses like mine. His vote against repealing the death tax is an issue I will take with me when I go to vote on his election this fall.
"This issue is so important to me that I have started discussing with my employees the many issues that directly affect not only the business, but how it will affect them," said Olivo. "I've encouraged them to take into consideration how their senator votes on small-business issues when they go to the polls."
Arizona Sen. Jon Kyl has long been a champion of the small-business community, and was the key sponsor of the death-tax repeal. He faces a strong election challenge from millionaire developer Jim Pederson. Understanding small-business issues, Kyl chose to side with the more than 100,000 small businesses in Arizona, and voted to eliminate the double taxation that hinders the growth and prosperity of countless Americans.
Stay tuned to NFIB.com/politics for more information on these and other races.
