National Cattlemen’s Beef Association President J.D. Alexander submitted comments on May 10 on behalf of NCBA to the House Committee on Ways and Means, Subcommittee on Select Revenue Measures regarding expiring tax provisions.
“Cattlemen deal with daily stress of uncertainty in water supply, feed availability, forecasting of prices, labor supply, the health and welfare of their animals, not to mention all of the other normal stressors that come with operating a family business. These are factors beyond our control and we do not ask nor want government assistance in addressing them,” said Alexander. “But one area the government can help is providing certainty in the tax code. The lack of certainty in the tax code is hindering our economic growth and is detrimental to our ability to reach our full potential.”
Alexander said one of the most important issues facing beef-producing families is the future of the estate tax, more commonly referred to as the death tax. The death tax is one of the leading causes of the breakup of multi-generation family farms and ranches. If Congress fails to act by the end of this year, the estate tax will revert to a $1 million exemption, taxed at a 55 percent rate. Increasing production costs, rising property values and an uncertain tax code, according to Alexander, make it difficult for family farmers and ranchers to plan for the future of their estates.
“We cannot afford for the estate tax to continue being a political football that is punted year after year. We need permanency in the tax code,” he said.
NCBA was pleased that temporary estate tax relief for two years was provided in the 2010 tax package. The current estate tax exemption applies to estates up to $5 million a person ($10 million per couple) and taxed at a rate of 35 percent. Alexander said NCBA supports a full and complete repeal of the estate tax, or at the very least, a long term extension of current estate tax relief or relief for estates engaged in production agriculture.