Bad polling and the estate tax

For some odd reason, the “Under the Dome” column in yesterday’s N&O went ahead and basically printed a press release from the Pope Foundation’s Civitas Institute.   Anyway, it was really just absurd Estate Tax Spin.  Via Civitas:

Two-thirds of voters oppose the estate tax in North Carolina, according to a new poll released today by the Civitas Institute.

When a North Carolina resident dies, the state government levies a tax of up to 16 percent on assets above $5 million and everything else the deceased owned. The tax is levied in addition to the Federal estate tax of 35 percent.  Sixty-six percent of voters oppose this practice while 25 percent said they support it.  Seven percent said they do not know or have no opinion.

Civitas tries to (or at least typically, it seems to me) play themselves as a fair-minded polling organization, but yet we get this:

“Voters across North Carolina widely recognize the inherent immorality of turning revenue department officials into grave robbers [emphasis mine].  Hopefully, state lawmakers will recognize the near-universal opposition to the state death tax and act to end this gruesome practice,” said Civitas Institute budget and tax policy analyst Brian Balfour.

Yowza– that’s strong language.  Not exactly designed to place a lot of confidence in Civitas’ polling.  Need I mention that 2/3 while a strong majority hardly represents “near-universal” opposition.  More importantly, though, I strongly, suspect that if voters actually understood what was going on with the estate tax, the numbers would look like this.  The polling question:

“When a North Carolina resident dies, the state government levies a tax of up to 16% on assets above $5 million which includes businesses, homes, farm animals, bank accounts and everything else the deceased owned. The tax is levied in addition to the Federal estate tax of 35%. Please tell me if you support or oppose this practice?”

My guess is that most people here something like, “North Carolina resident…dies… tax…homes… bank accounts… everything else(!)”  What if you asked a question and laying out the tax and said quite clearly: “this tax would only apply to North Carolina residents who have more than $5 million when then die.”  Or better yet, “the less than 1/4 of 1% of NC Residents…”  I’m confident the poll results would be dramatically different.   It’s also worth noting that a very substantial portion of the estate tax captures unrealized Capital Gains that would otherwise never be taxed.  If you bought $1000 of Apple stock in the 1990s’s that was worth $100,000 today, you’d owe taxes on it if you sold it.  However, if you never sold it, but passed it on to your heirs, that $99,000 capital gain is untaxed.   Taxing such gains is mostly what the estate tax is about.  There’s plenty of myths (you’d simply never believe which political party tends to spread them) about the Estate Tax and the Center for Budget Policy and Priorities nicely takes on the key ones, if you are curious.

 

About Steve Greene
Professor of Political Science at NC State http://faculty.chass.ncsu.edu/shgreene

One Response to Bad polling and the estate tax

  1. John says:

    The estate tax is the single most important tax in our Republic. Without it we’d have a simple oligarchy.

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