Agriculture is a prime mover of the Ohio economy, a vital sector that would be directly impacted by President Biden's proposed federal tax on the unrealized gain in asset values. Our state's leadership, including Sherrod Brown, needs to strongly oppose this tax and prevent it from gaining traction.
Farming and ranching are big business in Ohio and I've seen throughout my career how much value Ohio farmers contribute to our communities. Agriculture is the state's top industry, by many economic yardsticks, supporting 1 in 7 Ohio jobs. Ohio's 76,900 farms (more than 90% of which are family businesses) cover 13.5 million acres and produce more than 200 different products, annually contributing $124 billion to the state economy. The billion-dollar Ohio beef industry, for example, supports thousands more jobs on ranching operations that are 96% family owned.
The proposed federal asset tax plan would impose a 25% minimum tax on businesses, possibly including many Ohio food and agriculture operations, with income and assets totaling more than $100 million. Acreage, machinery, vehicles, outbuildings, livestock and the many other assets that make it possible for farms and ranches to operate can represent a significant amount of money. Agriculture is a capital-intensive industry, but that hardly means that farmers and ranchers, even those who run successful businesses, are flush with cash.
Their money is invested in their businesses and hitting them with a new tax on an unrealized increase in the value of their assets would be devastating for many agricultural families. Farms and ranches that have been kept within families could be put out of business when they are forced to sell off assets to raise enough money to pay their taxes.
There's no way the government could competently enforce this plan to begin with. Bureaucrats would make arbitrary assessments of changes in asset worth, which the owners would certainly push back against (and rightfully so). It would only be a home run for the lawyers who can cash in on contentious court challenges that could last for years.
And what happens during years when asset values decline? Is the government going to refund people the tax payments they've made in previous years? It's a ridiculous, poorly thought out plan.
Senator Brown's Ohio constituents will all be negatively impacted by an asset tax, whether they are connected to agriculture or just consumers who are already paying record grocery prices that a new tax would drive even higher. I hope he does the right thing for us by opposing the President's federal asset tax.
[I am] the longest serving director of the Ohio Department of Agriculture in state history, and also previously served as head of the Ohio Beef Council and Ohio Cattleman's Association.
Fred Dailey
Mount Vernon
