Like many Americans, April 15 is my least favorite day of the year. Even though the weather is almost perfect, the grass is growing and the flowers are blooming, something about the IRS tax collector kills the positive energy. This year, Easter weekend earns taxpayers a three-day extension to April 18, but it’s not much comfort. As tough as the tax situation is already, President Biden recently proposed to make it worse.
In the last week of March, President Biden released his Fiscal Year 2023 budget. Coming out three weeks before Tax Day, you might think he would propose some relief. Unfortunately, the President’s budget instead calls for more than $4 trillion in new taxes over the next 10 years. The White House’s talking points say these hikes are on corporations and “the wealthiest Americans.” In reality, they go far beyond that.
The 2023 Biden budget calls to repeal the 2017 Tax Cuts and Jobs Act, which lowered tax rates for all Americans. Undoing it would cause everyone to pay more taxes, regardless of their income level. During a time of out-of-control inflation and economic uncertainty, raising taxes on all Americans is an awful idea.
The Administration’s proposals take direct aim at family farmers, too. The President’s budget proposes massively increasing the death tax, cutting its exemption to one-third of its current level and raising the tax rate to an unconscionable 45%. Maybe even worse, President Biden’s budget would nearly eliminate the policy known as stepped-up basis. This would force many farmers’ children and grandchildren to sell the family farm, or a portion of it, just to pay the tax bill. Politicians often talk about the importance of family farms in our country, but they don’t always follow through when it counts like Missouri Congressman Jason Smith.
Congressman Smith is the top Republican on the House Budget Committee and a senior member of the tax law-writing Ways and Means Committee. I spoke to him for Farm Bureau’s podcast this week. Congressman Smith believes the Administration’s proposed changes to stepped-up basis “would be extremely detrimental not just to farmers, but all small businesses in Missouri.” To push back against this effort, he is a lead cosponsor of a resolution to preserve stepped-up basis, H.Res. 1015. Five Missourians are among the 80 bipartisan cosponsors.
Rep. Smith is also the nationwide leader of the effort to fully repeal the death tax. He has the support of 155 bipartisan cosponsors for his death tax repeal bill, H.R. 1712. When I asked him why he’s so focused on the death tax, he said something I hear from Missouri farmers all the time. He told me, “You work your entire life, you’re taxed your entire life. The last thing that your heirs, your kids and your spouse need is a bill from the IRS.”
I couldn’t have said it any better myself. We need to make it easier to pass on a family farm to the next generation, not harder. America can’t thrive without strong rural communities, and rural communities can’t thrive without strong farm and ranch families. With the support of our elected representatives, I believe we can stop these bad ideas before they become law. We shouldn’t have to dread next April 15 even more than normal.