Prominent farm-state leader Heidi Heitkamp (D-N.D.), a former U.S. Senator who endorsed Joe Biden for President, has come out in opposition to President Biden’s plan to kill stepped-up basis.
As reported today in The Hill:
Former Sen. Heidi Heitkamp (D-N.D.) is leading a new effort to push back against proposals to tax capital gains at death, as the Biden administration and Democratic lawmakers seek to make such a change to help pay for their spending priorities.
“I think it’s wrong as a matter of economics, looking at middle class families, but I also think that for the Democratic Party, this is a path that should not be walked politically,” Heitkamp said in a phone interview with The Hill.
Heitkamp, who served in the Senate from 2013-2019, is chair of a new nonprofit called Save America’s Family Enterprises (SAFE), which is launching a six-figure ad campaign.
Biden has arrogantly dismissed stepped-up basis as just a “little thing” he wants to eliminate.
But Heitkamp noted one of the many ways the Biden proposal would hit farmers:
“Now that we see an emerging entrepreneurial class within the Hispanic community and within the African American community, they won’t be able to take advantage of these tax rules that will allow them to grow their business and keep capital in their business,” she said.
Heitkamp also said that taxing capital gains at death carries political risks for Democrats, referencing a poll SAFE conducted that found that more voters were opposed to a bill on this topic than supported it.
“I think it won’t be well-received by the public,” she said.
House Agriculture Committee Chairman David Scott (D-Ga.) also opposes the Biden plan.
In a recent letter to Biden, he wrote:
I have serious concerns about proposed changes in tax provisions that could hurt our family farmers, ranchers and small businesses.
I am very concerned that proposals to pay for these investments could partially come on the backs of our food, fiber, and fuel producers. In particular, “step-up in basis” is a critical tool enabling family farming operations to continue from generation to generation. The potential for capital gains to be imposed on heirs at death of the landowner would impose a significant financial burden on these operations. Additionally, my understanding of the exemptions is that they would just delay the tax liability for those continuing the farming operation until time of sale, which could result in further consolidation in farmland ownership. This would make it more difficult for young, beginning, and socially disadvantaged farmers to get into farming.
While I appreciate that the proposal provides for some exemptions, the provisions could still result in significant tax burdens on many family farming operations.
Montana Senator Jon Tester (D), a farmer, also opposes the Biden plan.
“I’m a small farmer in eastern Montana, and it would have significant effects on me.”
Biden’s proposal violates his pledge against any tax increase on any American making less than $400,000 per year. His proposal contains no exemption for these Americans.