The Ranking Member of the House Agriculture Committee Frank Lucas, R-Okla., has voiced his displeasure with the Democratic budget which passed on a largely party-line vote last week.
"We have become entirely too comfortable talking about trillion dollar deficits without thinking about what that means for the future of our country," Lucas said. "It must stop. We are headed for rampant inflation, high interest rates, and huge tax increases that will shut down small businesses and family farms."
Lucas pointed out that with the Democratic budget the debt of the country will grow to be over 80% of the size of the entire annual production of goods and services. He called the Democratic budget an assault on production agriculture saying it will increase energy costs, increase taxes, and devastate rural economies. He also said the cap and trade plan will increase input costs and the estate tax will return and force families to sell their farms to satisfy the IRS.
However; the estate tax situation may change in conference as a result of an amendment that passed the Senate on a 51-48 vote last week. The amendment, introduced by Senators Blanche Lincoln, D-Ark., and Jon Kyl, R-Ariz., would raise the exemption to $5 million and lower the tax rate to a maximum of 35%. Currently, estates valued at more than $3.5 million, or $7 million for a couple, are taxed at a 45% rate. President Obama has proposed freezing it at this level so it can be dealt with at a later date. But if Congress doesn't act to freeze or reduce the estate tax, in 2011, it will revert to a 55% tax on estates worth $1 million or more.
The National Cattlemen's Beef Association voiced its strong support of the amendment. NCBA President Gary Voogt said this was a huge victory for farmers and ranchers and that they should have the right to pass on operations that have been in the family for several generations on to their children and grandchildren.
"Many farmers and ranchers are what we call 'land rich and cash poor,'" said Voogt. "This is not a tax cut for the rich. Cattle producers are often forced to sell off land, farm equipment, parts of the operation, or the entire ranch just to pay off liabilities under the death tax. This vote was a strong show of support for our producers, and we appreciate the Senators who stood up for their rights."
Voogt says NCBA will continue to push for a full repeal of the estate tax, but realizes that may not be viable in the current political and economic climate. He says in the meantime the Lincoln-Kyl amendment is the best option to provide relief."