The American Farm Bureau Federation supports replacing the current federal income tax system with a new tax code that encourages savings, investment and entrepreneurship. It also supports changes to ensure that the tax code treats farmers and ranchers fairly compared to other taxpayers.

AFBF recently outlined several general and specific goals for tax reform in a statement to President Bush's Advisory Panel on Federal Tax Reform. Death tax repeal continues to be AFBF's top tax priority.

"As land continues to increase in value for reasons other than its productive agricultural value, multi-generation farms can face large estate tax bills at times when their incomes are small," AFBF said. "When the forced sale of farm assets is the result, the economic viability of farms and ranches can be ruined."

AFBF said owners of other businesses may not face the same consequences of the death tax if their businesses are less capital-intensive and generate more income per dollar of assets. About twice as many farm estates pay death taxes compared to estates in general, according to Farm Bureau.

Any new tax code should include the elimination of capital gains taxes, payroll taxes, self-employment taxes and personal and corporate income taxes, as well as the alternative minimum tax, AFBF said. In addition, any new tax code should be revenue neutral, so as not to produce a tax increase.

Source: Association Release