FedEx CEO Fred Smith says he has no plans to leave Tennessee.

A noted conservative economist casually told state lawmakers this week that FedEx CEO Fred Smith had said he would leave the state if Tennessee’s estate tax wasn’t repealed. Smith denies making any such statement.

Arthur Laffer is the economist who invented the idea of “supply-side” economics, and he’s a favorite of conservative policy groups. Testifying to a legislative committee on Monday, he dropped the name of Memphis businessman Fred Smith, reporting that Smith said he’d leave Tennessee over the estate tax.

“And we don’t want to lose FedEx,” Laffer said.

FedEx media relations has since released a statement saying Smith has no plans to move. “I think my old friend Art Laffer misunderstood my comments,” he said.

While apparently erroneous, Smith is the first wealthy resident to be mentioned by name in a debate over ending the tax on inheritance. The governor and speakers of both chambers have talked about unnamed individuals who’ve left – or plan to – in order to avoid what they call the state’s “death tax.”

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Smith originally declined, on Monday, to comment on Laffer’s statements. On Tuesday the FedEx media department released this statement:

With respect to the reports on the statements of Arthur Laffer to the Tennessee legislature, Mr. Laffer and Mr. Smith did meet last week. In the course of a wide ranging conversation, Mr. Smith discussed the Hall Tax in Tennessee as well as business tax and the need for economic growth in Tennessee. “I think my old friend Art Laffer misunderstood my comments, as I have never taken a position on the estate tax, either the federal or the Tennessee estate tax,” said Fred Smith. “I have no plans to move from Tennessee.”

Our original story on Laffer’s testimony:

Supply-Side Guru Blames State’s Gift and Estate Taxes for Economic Lag

The video of Monday’s Fiscal Review Committee meeting is here.