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CONTACTS:
JO-ANNE PROKOPOWICZ (202) 637-3093
DOROTHY COLEMAN (202) 637-3077

FOR IMMEDIATE RELEASE

WASHINGTON, D.C., June 7, 2000 – The National Association of Manufacturers today released a survey on the economic burden of the current federal estate tax regime on small and medium manufacturers. House Ways and Means Committee member Jennifer Dunn (R-WA), who has been a key leader in pushing federal legislation to eliminate the tax, joined the NAM and small and medium manufacturers who have been adversely affected by the tax.

"Last summer, the NAM led the business community in supporting legislation to eliminate the death tax. After a disappointing veto, we are back again – stronger than ever – and our new survey shows that the death tax places a direct daily burden on small and medium manufacturers," said Dorothy B. Coleman, NAM’s vice president for tax policy. "We are especially pleased with the leadership of Rep. Jennifer Dunn and her work to create a bipartisan team to ensure a strong vote on the House floor for the Death Tax Elimination Act (H.R. 8) this week."

Coleman noted, "According to our survey, over the past five years over 40 percent of the respondents spent a total of more than $100,000 on attorney and consultant fees, life insurance premiums and other planning devices. On an annual basis, nearly 60 percent of the companies spend more than $25,000 for estate planning, with more than one-third spending more than $50,000.

"More than 10,000 of our membership are small and medium manufacturers so, for the NAM, elimination of the current estate and gift taxes is a top tax priority, said Coleman. "The phase-out of the burdensome death tax in H.R. 8 will dramatically reduce the time, money and energy spent by business owners on estate planning, saving many companies that today must be sold for purely tax reasons upon the death of their founders."

The survey also noted the following facts and concerns:

• Almost 60 percent of the respondents have created more than 20 new jobs in the past five years, and most expect to create a similar number during the next five years.
• Conversely, the companies surveyed indicated that they would lose a similar number of jobs because of the estate tax, if the present owner died.
• The estate tax could have additional negative impacts on these businesses. For almost two-thirds of the companies, if the present owner died tomorrow, plans for expansion would be delayed, substantially curtailed or abandoned.
• In nearly one-third of the cases, heirs would have to sell all or part of the business to pay the estate tax.

Coleman and Rep. Dunn also were joined by Frank Armstrong, Chairman, National Fruit Product Company, Winchester, Virginia; Bill Turley, President, Bechdon Company, Inc., Upper Marlboro, Maryland and Murray Gerber, President, Prototype & Plastic Mold Co., Middletown, Connecticut.

The survey was sent via facsimile on May 17 to 1800 small and medium NAM members and had a response rate of 16.6 percent. For a copy of the survey, please call Jo-Anne Prokopowicz at (202) 637-3093.

Be sure to visit our award-winning web site at http://www.nam.org/ for more information about legislative, policy and economic developments affecting manufacturers, employees and the economy.