The super-rich oppose elimination of the estate tax not only for monetary gain, but because their wealth has been placed in foundations. Foundations provide an income tax deduction, and if properly invested, provide a stream of income to the founders and heirs under the guise of managment fees and directors salaries. Also, the big foundations are notorious for donating to left-wing causes. Bill Gates and Ted Turner are two of the super-rich who have created foundations, and we have all heard of the Ford and Rockefeller Foundations.
African American business leaders support repeal of the death tax
04/06/2001
Jack Kemp
To: Members of the Senate
From: Jack Kemp
Re: African American Business Support for Repealing the Death Tax
Date: April 5, 2001
Forty-nine leading African-American businessmen and businesswomen, including Bob Johnson of BET Holdings, Earl Graves of Black Enterprise Magazine and Alice Houston of Automotive Carrier Services, took out an ad in newspapers across America yesterday to urge the Congress to repeal the "Death Tax." I am enclosing a facsimile of the ad because I think it is the single best and most succinct statement I have seen of why we all believe Congress should repeal this economically destructive tax, which is so harmful to the first generation of black entrepreneurs.
The Gift and Estate Tax is not a tax on wealth, as its proponents believe. It is a tax on getting wealthy as these businessmen and businesswomen understand. It is a tax on success, and as the ad points out, by depressing the return to capital investment it retards income growth for all workers. In short, it is just one more government-imposed obstacle preventing those on the bottom rungs of the economy from climbing the ladder of success to achieve the American Dream.
Abraham Lincoln said it best: "I take it that it is best for all to leave each man free to acquire property as fast as he can. Some will get wealthy. I don’t believe in a law to prevent a man from getting rich; it would do more harm than good." Nothing I can imagine violates the spirit of Lincoln’s sentiment more than for the government to tell people they are free to acquire as much property and wealth as they can during their lifetime, but will not be free to pass the fruits of their success along to their heirs when they die. Yet, that is precisely what we do with the "Death Tax."
Please read the arguments put forth in the attached ad and give them your serious consideration. I think you will find the arguments compelling and conclude as these businessmen and businesswomen do that it’s time to bury the estate tax once and for all.
AFRICAN AMERICAN BUSINESS LEADERS CALL FOR AN END TO THE ESTATE TAX
We the undersigned African Americans support the elimination of the Estate Tax. We call for the repeal of this tax for the following reasons:
The Estate tax is unfair double taxation since taxpayers are taxed twice – once when the money is earned and again when you die. The income taxes you pay, in some cases up to 40 percent, already redistributes wealth and provides for government services. The government should not require you to pay taxes again simply because you die. As the National Black Chamber of Commerce notes, a person who works hard, pays taxes along the way – both corporate and income taxes – and invests and saves money should not be penalized with punitive taxes at his or her death.
The Estate Tax will cause many of the more than 1 million black-owned family businesses to fail or be sold when the 55 percent Estate Tax is imposed on already undercapitalized minority-owned enterprises. The fact that the tax can be paid with interest over a number of years is off little comfort or no help to already cash-strapped minority firms. In addition, the entire Black community suffers when these minority-and family-run businesses that provide jobs and services in underserved communities are forced to shut down to pay the Estate Tax.
Unlike most White Americans, many African Americans who accumulated wealth did so facing race discrimination in education, employment, access to capital, and equal access to government resources. In many cases, race discrimination was supported by governmental policies and failure to enforce equal rights laws. It is unfair and unjust for the government through the Estate Tax to seize a portion of the estate of the individuals it failed to provide equal opportunity.
The Estate Tax is particularly unfair to the first generation of the high net worth African Americans who have accumulated wealth only recently. These individuals may have family members and relatives who have not been as fortunate in accumulating assets who could directly benefit from their share of an estate as heir. Elimination of the Estate Tax would allow African Americans to pass the full fruits of their labor to the next generation and beyond. Elimination of the Estate Tax will help close the gap in this nation between African American families and White families. The net worth of an average African American family is $20,000 or 10 percent of the $200,000 net worth of the average White family. Repealing the Estate Tax will permit wealth to grow in the Black community through investment in minority businesses that will stimulate the economic well-being of the Black community and allow African American families to participate fully in the American Dream.
The Estate Tax impedes economic growth because it levies yet another layer of taxes on capital. More capital investment means higher incomes for all workers. By encouraging intricate planning techniques to reduce taxes, the death tax has created an entire industry of specialized lawyers and accountants. The added complexity and compliance costs make this one of the least efficient federal taxes.
Warren Anderson – President and Owner – The Anderson-Dubose Company
Clarence Avant – President, Interior Music
Bernard B. Beal – CEO – M.R. Beal & Company
Dave Bing – Chairman – The Bing Group
Sherri Blount – Attorney – Fitch, Even, Tabin & Flannery
Thomas J. Burrell – Chairman – Burrell Communications Group
Gregory B. Calhoun – CEO – Calhoun Enterprises
Cleveland A. Christophe – Managing Partner – TSG Capital Group, LLC .
Kenton Clark – President – Computer Consulting Associates
Keith Clinkscales – Chairman & CEO – Vanguarde Media
Barry Cooper – CEO – Black Voices.com
Comer J. Cottrell – Owner – Cottrell Investments
David Dalton – President & CEO – Health Resource Inc.
Lemuel Daniels – Financial Consultant
Chester C. Davenport – Managing Director – Georgetown Partners, L.L.C.
Samuel Dickens, III – President & CEO – Premier Circuit Assembly, Inc.
Conway Downing, Jr. – Senior Advisor – Mattox Woolfolk LLC
Kenny Edmonds – President & CEO – Edmonds Entertainment
Gerold D. Edwards – President & CEO – Engineered Plastic Products, Inc.
Nathaniel R. Goldston, III – Chairman, President & CEO – Gourmet Services Inc.
Earl G. Graves, Sr. – Publisher & CEO – Black Enterprise Magazine
Edward W. Gray, Jr. – Attoney – Fitch, Even, Tabin & Flannery
Ernest Green – Managing Director – Lehman Brothers
Ambassador Bradley P. Holmes
A. Wade Houston – CEO JHT Holdings, Inc.
Alice K. Houston – President & CEO – Automotive Carrier Services
Gwendolyn Smith Iloani – President & CEO – Smith Wiley & Company
Don Jackson – Chairman & CEO – Central City Productions
Charlie W. Johnson – President & CEO – Active Transportation
Eric G. Johnson – President & CEO – Baldwin Richardson Foods Company
Robert L. Johnson – Chairman & CEO – BET Holdings, Inc.
Debra L. Lee – President & COO – BET Holdings, Inc
Butch Lewis – President & CEO – Butch Lewis Productions, Inc.
Byron Lewis – Chairman & CEO – UniWorld Group, Inc.
Ed Lewis – Chairman & CEO – Essence Communications Partners
Alfred Liggins – CEO – Radio One, Inc.
Denise H. Lloyd – President & CEO – D.H. Lloyd & Associates, Inc.
Dr. Samuel Metters – President & CEO – Metters Industries, Inc.
B. Doyle Mitchell, Jr. – President & CEO – Industrial Bank, N.A.
Dominic Ozanne – President – Ozanne Construction Company
Mamon Powers, Jr. – President – Powers & Sons Construction Company, Inc.
John L. Procope – Chairman – E.G. Bowman Company Inc.
Herman J. Russell – Chairman – H.J. Russell & Company
Alexis Scott – Publisher & CEO – Atlanta Daily World
Sydney L. Small – Chairman – Access 1 Communications Corp.
Warren M. Thompson – Chairman & CEO – Thompson Hospitality Corp.
Maurice B. Tose – President – TeleCommunications Systems, Inc.
Houston L. Williams – CEO – Pacific Network Supply, Inc.
James Winters – President – United Energy
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