While jobs and the economy are at the forefront of all Americans’ minds, Congress has the ability to create jobs, raise federal revenues, and boost the economy at the end of their fingertips —without any expense to the taxpayer. This could all be achieved simply by permanently repealing the death tax.

At a lecture at the Family Research Council, Dick Patten, the President of the American Family Business Institute, presented a compelling case for repealing the death tax. The death tax is a costly burden for small family-owned businesses. According to President Obama, small business “created roughly 70% of all new jobs in the past decade.” And yet the death tax punishes growth of these job producers by making it difficult for them to succeed after the death of their owner. A study by Prince and Associates showed that “the need to raise funds to pay estate taxes” was cited by 98% of respondents as the reason for failure of such firms.

The death tax has been on a path towards elimination since 2001, thanks to the 2001 and 2003 tax cuts. Those cuts abolished the tax for 2010, but only for one year. The tax comes roaring back to life in 2011 at its rate and exemption levels prior to the cuts. Now Congress must decide whether to repeal the currently dormant tax permanently, or to allow it to resume in 2011 at its pre-tax cut levels: 55 percent on estates worth over $1 million. Hanging in the equation are jobs and economic growth.

The decision should be an easy one given the facts. Patten outlined studies done by former director of the Congressional Budget Office Douglas Holtz-Eakin, Ph.D and Stephen Entin, President of the Institute for Research on the Economics of Taxation show that while reinstating the death tax would cost 500,000 jobs, repealing it altogether would actually create 1.5 million jobs—almost half of President Obama’s not yet reached goal of 3.5 million jobs under the $800 billion stimulus bill.

What is more, unlike the President’s failed stimulus plan, repealing the death tax would have no net cost. Rather, federal revenues would rise were the death tax to permanently expire. Entin shows that fully repealing the death tax would decrease revenues for the federal government by $19.2 billion a year, relative to 2009 rates. However, revenues from other tax collections would increase as a result, to a total of $42.4 billion. Together, this means that repealing the death tax would create a net federal yearly revenue gain of $23.3 billion, more than doubling the revenue created by the death tax. Congress could then cut income tax rates for all taxpayers to make sure there is not a net tax increase.

Many wrongly see the tax as a mode of redistribution from the wealthy to the not-so-wealthy. But in reality, the death tax punishes middle and low-income Americans by discouraging new hiring and stifling new growth.

The United States has the third highest death tax in the world. All other western countries tax estates well below what we do. Furthermore, in Heritage’s recent publication of the Index for Economic Freedom, all of the countries that ranked more economically free than the United States did not have a death tax at all. The choice is clear: repeal the death tax and protect American prosperity by ensuring jobs and economic growth at zero cost to the taxpayer, or allow the tax to continue to lead us down the road towards economic decay.