The estate tax is back on the chopping block. State legislators are looking to get rid of Ohio's "death tax."
They say the tax encourages people to leave the state only 19 states have an estate tax. Warm-weather states that attract so many retirees do not have the tax.
But people are moving to these places because of, you know, the weather. And as far as taxes go, that states like Florida don't have an income tax is a lot more important.
There are a lot more arguments on both sides, of course: Most of that money has already been taxed, often more than once. And what about peoples' right to do whatever they want with their property?
Or, the state needs the money the 7,700 estates that qualified in the last year raised $273 million. Twenty percent goes to the state a billion dollars in the foreseeable future, according to Gov. Ted Strickland. Eighty percent goes to local governments and is often a significant source of income.
All of that is beside the point. The estate tax was invented for one reason: social mobility. The tax prevents a small minority of the very rich from becoming a de facto aristocracy.
Republicans are fond of citing the family farm. But that's why the tax has a floor $338,333 at the state level. The tax isn't about the family farm. It's about Paris Hilton.
The Hiltons haven't really done anything for a couple generations now except sue to break the estate of the last one that did any work. But Paris, God love her, is busily becoming an industry of her own. If she continues to make the most of her position, then she may one day be even richer than her forebears. Otherwise, because the estate tax keeps chopping up the Hilton fortune with each successive generation, Paris will find herself 40 and broke. And poor really won't look good on her.
Rather than enshrining Paris a Grand Duchess of Hotels, it is far better for everyone if we open the way for anyone to build his own fortune including Paris if she chooses. And as far as her parents' property rights go, they were able to give her a heck of an opportunity.
The estate tax is about opportunity opportunity for everyone. Debate about how equal that opportunity should be and about how we balance that with individual rights is inevitable and good. But actually repealing the tax should be taken off the table.