Posted: 10/23/2003
Death Tax Killing Many Privatly Owned Forests
Dallas, TX (October 23, 2003) – A new report from the National Center for Policy Analysis (NCPA) concludes that the “death tax” is causing many of our nation’s privately owned forests to be prematurely and unnecessarily thinned or sold for development. The report can be viewed online: Taxing Forests to Death.
Forest owners, many of whom are cash-poor, find that they face steep estate tax bills because the value of their land has increased substantially due to rising timber prices generated by suburban growth and ever-increasing environmental regulations on publicly owned forests. In most cases, these forest owners have little choice but to log their forest or sell their land to developers.
“One of the most ignored environmental problems today is the harm the death tax is imposing on the health of our nation’s forests and the wildlife that live there,” said NCPA Senior Fellow H. Sterling Burnett. “Most forest owners would prefer to conserve their land for recreation and wildlife preservation, but are left with few options.
According to the NCPA report:
- The estate tax forces landowners nationwide to sell 1.4 million acres per year and to harvest more than 2.6 million acres of timber.
- Nationally, more than 30 percent of forest owners were subject to the estate tax, and 40 percent of those sold timber or land in order to make the payment.
- Nearly 70 percent of those who sold timber and well over half of those who sold their land had no other assets available to pay the estate tax.
The death tax doubly impacts the heirs of small forest owners who are also in the timber or related industry, forcing family members to pay more in taxes than they reap in profits from the business. The average tree farm is valued at about $2 million, while the average annual household income of a tree farmer is less than $50,000.
“For all the outraged leveled by some environmentalists about thinning of public forests to reduce wildfire threats, they are disappointingly silent about the unwanted harvesting of private forests forced by the death tax, said Burnett. “Ending the death tax for good would help families preserve forests, save wildlife and protect small businesses.”