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The Times endorses
Repeal the death tax
Initiative 920, the measure to repeal Washington's death tax, is a reasonable measure. Its opponents distort it with fun-house mirrors, attempting to make the tax on assets at death both smaller and bigger than it really is.
In its capacity as a money-raiser for the state, the opponents try to make it big, implying that its loss will affect public schools. This is hard to believe, if you look at the numbers. The state's Office of Financial Management estimates the loss at $92 million a year for the entire state. For state government, that is three-tenths of 1 percent of total spending. It is about $15 per person per year. We believe repeal won't even cost that much, because the tax prevents so much investment in family companies that it costs the government more than it's worth. We can't prove that, so set it aside. Still, its value to the state is no more than about $15 per person per year.
At the same time as opponents are trying to make this tax look bigger than it really is, they assure the public that hardly anyone pays it. There is some truth to that: The death tax falls directly on only a few, and most of those pay it only once in their lives, when their last parent dies. But it hits those few at a grievous time, and very hard. Most of all, it causes them to make decisions that have bad public and social consequences.
Coupled with the federal death tax, which is larger than the state tax, it causes owners of family companies to sell them, often to big, out-of-state corporations. We know about that, because that is what happened in our industry. It is why daily newspapers in almost every American city are owned by large chains. That development was not good for journalism or for democracy.
We are not opposed to taxes, including taxes on the rich. The right way to tax people is a little bite many times, so that they can get used to it.
The death tax is the opposite: It is a big bite, and it falls when nature triggers it, not when the person is able to pay it.
Death should not be a taxable event.
Copyright © 2006 The Seattle Times Company