Thursday, March 24, 2011

Waterville mayor testifies for repeal of Ohio's estate taxx

Mayor Derek Merrin is scheduled to testify this morning on S.B. 90, the repeal of Ohio's estate tax. These are his prepared remarks:

My name is Derek Merrin; I’m the mayor of the Village of Waterville. Waterville is located in Lucas County and has a population of approximately 5,500 residents. Our general fund budget is about $3,100,000. Historically, we have received $30,000 to $60,000 annually from the estate tax, which represents less than two percent of the general fund budget.

I fully support S.B. 90—the repeal of the estate tax. The tax is morally wrong; it is misguided tax policy and has put Ohio at a competitive disadvantage.

An individual’s estate consists of after-tax dollars. Their earnings have already been taxed multiple times. Even though deceased Ohioans have worked hard, played by the system, saved responsibly, the State of Ohio’s estate tax swoops in and plies their savings from their hands. This is morally unjust and cannot be rationalized.

It’s been said, “The goodness of a nation can be judged by how it cares for its dead.” If the state of Ohio would be judged by this standard, it would fail.

As an Ohio mayor, I felt compelled to testify today. A few short-sighted, local officials have been vocally protesting the repeal of the estate tax. They claim their cities, villages, and townships will lose revenue if the tax is repealed. They have missed the whole point.
The tax is hurting the entire state of Ohio, which includes their communities. As the state of Ohio goes, so goes local communities.

The tax has contributed to Ohio’s population decline. When Ohioans leave to protect their assets, Ohio loses their wealth, spending power, and future capital investments. I might add that those are all taxable. It’s not a zero-sum game. On the contrary, if you repeal the tax, Ohio will ultimately increase collection on other taxes, particularly income and sales taxes. See, taxes only generate revenue if there are people and wealth to tax. This isn’t about political ideology, but common-sense economic principles that have been proven true over time.

Furthermore, when Ohioans leave, we lose human capital that is vital for economic growth. The estate tax motivates successful businessman, entrepreneurs, and older residents to leave Ohio. Not only do we lose their financial resources and seed money, but we lose their experience, business acumen, and talent to continue to invest in Ohio.

Thirty states do not have an estate/inheritance tax and realize its poor public policy. By most economic indicators, those states are outpacing Ohio in job creation. Many local officials have neglected to see this economic phenomenon and failed to see the big picture.

Senators: You were elected—with the hope you would see the big picture and understand the macro-effects of tax policy. It’s clear that Ohio’s estate tax is an impediment to economic growth. To help local communities and the state of Ohio to prosper, I encourage you to repeal the estate tax. It’s time Ohio has a tax structure that moves Ohio forward.


Mad Jack said...

This guy is great! I wrote and told him so - I hope he'll keep up the good work.

Do you know him at all?

Maggie Thurber said...

Yes, Mad Jack. Derek is a friend...I've followed his career for a long time now and have helped him when asked to do so. I'm glad to support him.

I think he has a great future, too!

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