‘Fiscal cliff’ deal costs California $45 million from death tax
By John Seiler
Even death is not being kind to the California budget. According to the Bee:
“Because Congress permanently killed an estate tax transfer to states this week, California stands to lose $45 million in inheritance tax revenue that Gov. Jerry Brown and lawmakers anticipated in their June budget, according to the Department of Finance.
“As part of the “fiscal cliff” agreement, Congress permanently eliminated the state estate tax credit, a device once used to return a share of federal inheritance taxes to states. The nonpartisan Legislative Analyst’s Office says that likely means California won’t receive estate tax revenues again without a vote of the people.”
In California, Proposition 6, which voters passed in 1982, prohibits the state from collecting an estate tax — better called a death tax.
The death tax often destroys family businesses because the heirs of an estate only can pay the death tax by breaking up the family farm or business through sales to a big conglomerate.
What do you bet that the supermajority Democrats in the Legislature now will try to bring back to the California death tax by putting it on the ballot in 2014? Democrats will insist, “The filthy rich are ripping us off again! They’re living it up on their yachts even after they’re dead! They need to pay their fair share for the education of our youth in our world-leading schools!” — meaning pay more for the teachers’ pensions, and schools that are leading at the bottom of test scores.
If that happens, it’ll be another reason to leave the state — before the grim taxer follows the grim reaper and grabs your money even as you leave the hospital in a body bag.
May 23, 2013