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Orcutt disappointed by
Democrats' refusal to bury new death tax
Republican tax policy leader forces vote, says tax
puts economy at risk
Washington’s year-old
death tax continues to live despite
Rep. Ed Orcutt's
efforts to repeal it.
Disappointed that his bill
to do away with the tax died in the House Finance Committee without
receiving a public hearing, the Kalama Republican today forced a House
vote on his motion to move a new, identical measure forward. House
Democrats, who created the death tax in 2005, voted to reject Orcutt’s
motion, 53-45.
“I’m not content to let small businesses die from having to liquidate
their assets to pay one of the most punitive death taxes in the nation.
And I feel we should live up to the intent the voters of Washington
expressed when they created the previous estate tax law 25 years ago,”
said Orcutt. “The majority party was certainly willing to debate those
points when it wanted a new death tax. Now that revenue forecast after
revenue forecast proves the death tax isn’t needed, they have little
interest in returning to the voters’ intent.
“If they can’t defend keeping the death tax, then let’s repeal it – for
the sake of our economy and the small family-owned businesses like
commercial printing shops or other enterprises that have millions tied
up in property and equipment but little cash to
pay the tax,” Orcutt explained.
In 1981 Washington voters passed Initiative 402, which specified the
state would collect only a “pick-up tax” for estates by taking a portion
of the federal estate tax due. In 2002 the federal government began a
10-year phase-out of the estate tax, but Washington’s law wasn’t updated
to reflect that change. The state improperly collected an estate tax
from 2002 until the state Supreme Court threw it out in early 2005.
Within a month, the Legislature’s majority party created a new death tax
so it could increase state spending by 12.4 percent.
Washington’s death tax applies to all non-farm estates valued at over $2
million. A credit is available for family farms but some farms will not
escape the death tax despite claims that farms are exempt. No deduction
is allowed for family businesses.
Orcutt’s legislation would return to the voters’ intent with the system
created by I-402. The state would benefit when the federal government
reinstates the pick-up credit.
On the day a bill is introduced in the House members may make a motion
to move it ahead on the House voting calendar rather than refer it to a
House committee. At 5 p.m. today House Bill 2841 died, so Orcutt
introduced the same language as House Bill 3306 and made the motion to
move that bill forward.
“I would have welcomed a committee hearing on House Bill 2841 to give
our employers an opportunity to explain the risks they face because of
the death tax,” said Orcutt, Republican leader on the House Finance
Committee. “But a hearing isn’t essential because the arguments made
against the death tax last year are just as valid today, and each member
of the House knows them.
“We easily could have moved House Bill 3306 out of the House and over to
the Senate, but that would have required the majority party to do two
things: first, acknowledge heirs should get to keep more of the assets
their relatives worked hard to earn, and second, take another look at
its budget priorities. Apparently it’s unwilling to do either.”
# # #
For more information, contact:
Brendon Wold, Public
Information Officer: (360) 786-7698
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