The Nation, This Tax Day, ‘Farms’ Owned by the Rich Provide Massive Tax Shelter:

For all those feeling the pinch this Tax Day, rest assured America’s wealthiest one percent have no idea what you’re going through. Not only have they shaved a projected collective $121 billion off their income taxes thanks to Bush’s tax cuts for the rich but, thanks to misuse of agricultural tax breaks, many will not end up paying their fair share of property taxes either.

Take Michael Dell, founder of Dell Computers and the second-richest Texan, who qualified for an agricultural property tax break on his sprawling 1,757-acre residential ranch in suburban Austin and saved over $1 million simply because his family and friends sometimes use the land as a private hunting preserve to shoot deer. Or take billionaire publisher Steve Forbes, who got more than a 90% property tax reduction on hundreds of acres of his multimillion-dollar estate in upscale Bedminister, New Jersey, just by putting a couple of cows out to pasture. They are not alone. All across the country, a huge number of America’s wealthiest are tapping into agricultural tax breaks—and none of them have to do any real farming to qualify.

Not only are agricultural tax breaks allowing wealthy landowners to shift their tax burden onto other less-affluent taxpayers but they are also helping bankrupt public schools, which derive the bulk of their funding from local property taxes.

Agricultural tax breaks got their start in the ’50s and ’60s, as a response to the explosive growth of suburban development, which was encroaching on farmland and raising agricultural property values to the point where farmers were having paying their tax bills. Fearing that this would pressure farmers into selling out to developers, states began granting exemptions that allowed agricultural land to be assessed at rates well below market value. The practice, called use-value assessment, is today used by all but one of the fifty states to artificially deflate the value of farmland, frequently by 90% or more.

The plan looked good on paper, but in the real world it was quickly manipulated to steer money to the rich. Many states expanded the definition of “agricultural land” beyond land that was farmed to land that simply had not yet been developed. …

It seems state legislators from both parties are more keen on slashing social spending, perfectly willing to plunge a whole generation of Americans into ignorance and poverty just so that a small number of millionaires and billionaires can keep dodging their property taxes.

(Hat Tip: David Herzig.)