“The inheritance tax now has a lot of enemies and almost no friends,” Tom Brokaw declared on the April 14 NBC Nightly News. At least, it has no defenders that NBC was willing to let viewers see.
Correspondent Mike Jensen opened his report with the statement that “thousands of farmers and small business owners face huge death taxes each year.” He then aired interviews with two people who are presented as victims of the federal estate tax and with Sen. Richard Lugar (R.-Ind.), an opponent of the taxes.
If NBC wanted the other side of the story, Jensen could have talked to Citizens for Tax Justice, a D.C.-based advocacy group that would have supplied some missing info—like the fact that the estate tax only affects the top 1.2 percent of all estates, and 95 percent is paid by heirs to estates worth more than $1 million.
When we contacted Michael Ettlinger, an analyst for CTJ, he pointed out some major holes in NBC’s story. For example, one of the stories presented by Jensen involved a woman from Virginia. “According to the report, she had to pay more than $1.3 million in federal estate taxes—mostly on the family horse farm,” Ettlinger noted. “If she paid $1.3 million on a Virginia horse farm, the estate she inherited was worth close to $4 million. Thus, after selling the horse farm and paying federal and state estate tax, she had over $2.4 million.” Yet NBC portrayed her as being ruined by the inheritance tax, forced to work the night shift at a neighbor’s horse farm.
While Jensen describes the farmer’s daughter as being “typical,” only one farmer in 25 dies with a taxable estate; less than a third of 1 percent of inheritance tax revenue comes from farm assets, and only 7 percent derives from small businesses of any kind (New York Times, 4/13/97).
NBC may have jerked a lot of tears with its report–it ends with the woman wondering whether she can afford to buy a pony for her grandchild–but it didn’t shed much light on the tax debate.
If you’d like to see NBC cover more than one side of the estate tax issue, you can write to Tom Brokaw at 30 Rockefeller Plaza, New York, NY 10112; or call 212-664-4971 (email: email@example.com). Visit the Citizens for Tax Justice website at www.ctj.org/.