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Repealing Death Tax Will Create Jobs and Boost Economy

Palmer Schoening and Patrick Fagan, Ph.D.

The death tax, which negatively affects family businesses, will soon be modified. In a rare opportunity, Congress can increase its revenues, increase employment and stimulate the economy if it chooses to repeal the death tax. If the death tax returns to its 2001 (high) levels, Congress will collect less revenue while the country will have fewer companies and fewer jobs. All sectors of the economy, and especially the individual states, have much at stake.

An $800 billion stimulus package has been passed in the hope that it will "create or save" 3.5 million jobs over the next two years while keeping the death tax intact at current rates. Douglas Holtz-Eakin's new study Changing Views of the Estate Tax: Implications for Legislative Options shows that eliminating the death tax at no cost to tax payers will create over 1.5 million jobs and slash the unemployment rate nearly a full percentage point over that time period, bringing the Administration almost halfway to its goal of 3.5 million jobs.

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