The Repeal of the Estate Tax
The hot issue over in Ohio right now is the repeal of estate tax by 2013. There are those who want estate tax removed and there are others who want it retained.
An estate or inheritance tax is levied on an heir’s inherited assets if the value exceeds a threshold set by the state. In Ohio’s case, the exclusion limit is set at $338,833.
A coalition, called Protect Ohio’s Communities, contends that the estate tax constitutes a significant portion of the state’s budget. Repealing estate tax will adversely affect community services. Further, to make up for the lost budget, some other area will only be taxed or existing taxes will be raised.
On the other hand, Sen. Grendell supports the repeal of the estate tax in Ohio. To quote, it is “socialist and un-American.” He maintains that taxing estates has caused residents to move to Florida. And since this tax is dependent on deaths, the annual amount cannot be consistent hence should not be relied on to fund community services and expenses.
The House bill 153 for the repeal of the estate tax is now being considered by the Senate.
The battle continues in Ohio, while Florida continues to enjoy freedom from a separate state estate tax. The Economic Growth and Tax Relief Reconciliation Act of 2001 ensured that a separate estate tax would not be levied on Floridians without voter approval. When the Act went into effect, Florida opted not have another form of taxation to replace it.
Ohio, like a handful of states, is waking up to the reality that reducing taxes is a way to create jobs and keep people from moving to other states like Florida which are much more tax friendly. Ohio and the rest of the “rust belt” states need to focus on what is best for their residents. In my opinion, they should start by reducing taxes and the size of government. If they don’t more people will flock to states like Texas and Florida where the burdens imposed by government are much less severe.
To learn more about Florida’s taxation (or freedom from it), read Chapter 2 of the Florida Domicile Handbook.
