Des Moines Register
04-20-07
Eliminating federal estate tax good for Iowans, Romney says
The Republican presidential candidate says that as land values take off, more
farmers will be subject to the levy.
By THOMAS BEAUMONT
REGISTER STAFF WRITER
Bettendorf, Ia. - Republican presidential candidate Mitt Romney said in Iowa
Thursday that eliminating the federal estate tax would help more Iowa families as
corn-producing land's value increases with the demand for ethanol.
"Family farms, in particular if they are raising corn, are going to see the value of
their land skyrocket," Romney told reporters after speaking to about 350
Republican activists in Bettendorf.
"And to say, well, that means you've got to sell the farm, you can't pass it on to
your kids, you've got to sell it to pay the taxes, it's just not fair," he added.
Eliminating the estate tax is a common proposal among Republicans, who often
call the tax levied on individuals who inherit farms or businesses the "death tax."
Romney's proposal has political appeal, but would have little effect on Iowa
farmers, said Roger McEowen, Iowa State University agricultural economist.
"It has virtually no impact when you bring it down to Iowa," said McEowen,
director of ISU's Center for Agricultural Law and Taxation. "It's not a death tax.
That's misconstruing it."
McEowen said that Iowa continually ranks near the bottom of the list of states
ranked in order of the amount of estate taxes paid. He cited a nonpartisan
Congressional Budget Office study from 2004 that showed of the roughly 25,000
deaths in Iowa, fewer than 1 percent generated estate tax returns.
Most Iowa farms are valued at less than the $2 million threshold required to
trigger the estate tax, McEowen said, especially considering the debt owed on
most farms.
In 2009, the law will change to exempt estates valued at less than $3.5 million,
meaning individuals who inherit estates valued at more than that will pay the tax.
Romney, whose campaign is organizing aggressively in Iowa, was making his
third trip in as many weeks to the leadoff caucus state.
He said he was unaware how many Iowa farms would benefit from the
elimination of the estate tax.
But more Iowa farms could increase in value as the nation's renewable fuel
industry develops, he said.
Iowa's status as the nation's leading corn-producing state means its farmland is
going to increase in value in light of the increasing demand ethanol, the cornbased fuel additive, Romney said.
Regardless of whether more Iowa farms reach the estate tax threshold as a
result of the biofuel focus, Romney said he objects to the tax.
"I believe that it's simply unfair to tax people when they earn their money, then
again when they save their money, and then again when they die," he said.
Bettendorf Republicans Hank and Meg Farber, who attended the hotel reception,
said they were intrigued by Romney, given his election in Democrat-heavy
Massachusetts.
"He's an interesting candidate," said Meg Farber. "A fresh face," added Hank.
Romney, who also met privately with Quad Cities business leaders, was at the
outset of a two-day eastern Iowa trip.
Romney has stops planned today in Maquoketa, Anamosa and Coralville.
Reporter Thomas Beaumont can be reached at (515) 286-2532 or
tbeaumont@dmreg.com