Question

Q670. Some taxes are paid to the federal govermment in Washington and some are paid to state and local govermments. Of the following federal taxes, which do you think is the worst tax-that isthe least fair? 20062005 30% 26% 15% 890 21% 31% 25% The federal estate tax Federal income tax Social Secity payıoll tax Federal corporate income tax Not sure 0 7% 21%

Answer 1

In my opinion the federal estate tax is the worst tax. The federal estate tax refer to tax on property (such as stock, cash, real estate, or other assets) transferred from deceased persons to their heirs. The estate tax is especially harmful to small businesses and farms as it forces heirs for the depletion of the working capital and even selling the business assets or farm land to pay it. Also from the perspective of taxpayers is that it can force you double taxation: once when a person earn it and once when the money passes to the heirs. Moreover the amount raised is partially offset by high cost incurred by the government in collecting it, such as in dealing with issues related to valuation. It leads to an unnecessary additional government spending, and is an attempt to redistribute wealth by taking from those who earned it and distributing to those who did not. Consequently people will save less as they don’t want their estates to be subject to the tax.