04 Apr 2001 Wealthy Blacks Seeking to Pass on Hard-Won Legacy to Their Community and Families Join Project 21’s Call for Tax Reform With Newspaper Ad Campaign
Many of the nation’s top black entrepreneurs are independently joining the African-American leadership network Project 21’s long-standing call for a repeal of federal estate taxes. Taxing the legacy of successful black Americans, Project 21 members contend, threatens to destroy some of their greatest achievements and creates yet another roadblock to black progress and wealth-creation.
Estate taxes, also called "death taxes," entitle the government to take up to 55% of a person’s wealth when they die. Most people do not have enough assets to trigger the death tax. The heirs of business owners or farmers, however, must pay taxes on the total worth of the deceased’s estates – regardless of the profitability. They are often forced to sell farms and businesses in order to pay taxes. With income levels of black Americans tripling between 1987 and 1997 and the number of black-owned businesses doubling to almost one million, death taxes are becoming an increasing burden.
President George W. Bush’s tax relief proposal seeks to phase out the estate tax. The "Death Tax Elimination Act" in the U.S. House of Representatives would do so by 2011. Similar legislation was passed in 2000 by a vote of 279 to 136, but was opposed by the Clinton Administration.
Black Entertainment Television founder Robert L. Johnson has organized over three dozen black business leaders in opposition to death taxes. His coalition was formed in part because wealthy white liberals like Bill Gates Sr. recently began speaking out in defense of death taxes. Johnson, who said he is worth over $1.5 billion, pays hundred of thousands of dollars every year for insurance premiums to protect his fortune – "transferring wealth out of the black community to the majority community." He notes that the majority of black wealth has been created since the passage of the Civil Rights Act of 1964, and that death taxes threaten to stop this first generation of wealth from being passed on the future generations.
Ads placed by Johnson’s coalition, which includes media executive Earl Graves and Ed Lewis and investment executive Ernie Green, began running in newspapers on April 4.
"The government is essentially taxing us twice – once when we earn it and again when we leave," said Project 21 member Ak’bar A. Shabazz. "We are trying to succeed because we want to pass something on to our children. Death taxes prevent people who have worked hard and become wealthy from ensuring that their kids can benefit as well. It’s not good for anybody."
Project 21 has been a leading voice of the African-American community since 1992. For more information, contact David Almasi at (202) 507-6398 x106 or [email protected], or visit Project 21’s website at http://www.project21.org/P21Index.html.