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Repealing unfair taxes on family farmers small business owners and working families

McGuireWoods Consulting has broad expertise in taxes, with successful efforts in multiple states to protect our clients from increases that would hurt their businesses.

One of our most dramatic successes was repeal of the state death tax. While many states were increasing their death taxes-and others were simply deadlocked on the controversial issue-we were successful in having the tax repealed at the state level. To succeed, we overcame significant political maneuvering, including a gubernatorial veto, intervening election and worked successfully with multiple legislatures and governors.

Framing the Issue
There was wide misperception that repeal of the death tax would benefit only the wealthy. In fact, our research showed that the tax profoundly affected family farms and small businesses, including farms, sometimes to the point of wiping out savings and destroying the business. Public opinion research undertaken for this effort showed that more than two-thirds of voters found the death tax to be unfair, and even during dim economic times supported repeal of the tax.

Our first task was to create a sophisticated message to educate the public and build a coalition to present this side of the story to legislators. We used web-based technology and tactics to engage the public, small business owners, minority- and women-owned business, the agriculture community and other business groups. Direct mail and advertising campaigns targeted key voters and voter blocs to increase community awareness. Ultimately, we developed a strong coalition of more than 60 leading organizations and thousands of individuals to speak out together in support of full repeal of the state death tax.

Bipartisan Approach
We knew that the effort would not work without support from both parties. We worked to avoid a battle between pro- and anti-tax forces. Knowing the issue was more nuanced, we recruited leaders who weren't necessarily against raising taxes but also wanted to support their constituents with small farms and businesses. Getting key decision-makers on board with a winning message first was critical. So while the controversial issue seemed to be irreconcilable elsewhere, our well-connected bipartisan team was able to engage legislators on both sides of the aisle.

Our support in the legislature and the community lead to passage of the tax relief, which was signed by the newly elected Democrat governor in his first year in office.