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Minnesota Senate Republicans rolled out a tax package Wednesday that cuts business property taxes, reduces state aid to local governments and gives cities the option to raise local sales taxes.

Senate GOP rolls out tax package

 Peter Bartz-Gallagher)

Senate Taxes Chairwoman Julianne Ortman (Staff photo: Peter Bartz-Gallagher)

Minnesota Senate Republicans rolled out a tax package Wednesday that cuts business property taxes, reduces state aid to local governments and gives cities the option to raise local sales taxes.

The bill proposed by Republican Taxes Chairwoman Julianne Ortman phases out business property taxes completely by 2023, cuts aid to local governments by about $640 million for the biennium and allows cities to seek voter approval to raise local sales taxes up to one-half of a percent to pay for capital investment projects.

The proposal also includes a sales tax exemption for townships, and is missing a provision to cut the state’s corporate income tax rate. GOP Sen. Geoff Michel proposed the corporate tax cut as part of the symbolic first bill of the session.

The Senate GOP tax bill differs considerably from its House Republican counterpart. Unlike the Senate, the House bill includes $220 million in proposed income tax cuts for low and middle class Minnesotans and targets Minneapolis, St. Paul and Duluth for local aid cuts. The Senate reductions to local government aid mirrors those made in the first GOP budget cutting bill, which was vetoed by Gov. Mark Dayton.

DFL Senate Minority Leader Tom Bakk and Sen. John Marty criticized the bill, saying it increases property taxes on cities via cuts to local government aid. “This bill just continues down that same old path – local governments are the problem; we’re going to cut aid to them. We don’t care how much property taxes go up,'” he said.

Bakk also questioned a change in the Senate taxes target. The number dropped from $780 million in the original GOP budget target to $580 million in the bill.  Bakk said there was no warning or explanation for the change, and Republicans may have broken Senate rules with the last-minute adjustment.

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2 comments

  1. The big problem here is that the political process is always about gradualization. In case anybody has missed the point, these are “unprecedented” times. We have kicked so many societal problem cans down the road for so long, that we need serious, and if I might say so, radical reform, and we need it yesterday. I would submit that unprecedented times call for unprecedented solutions.

    I certainly respect the opinion of these folks “in the arena” when they believe the voters will never understand or support seemingly radical or untested solutions. But the usual attempts at reform always seem to end up being too little, too late. We always hear from apologists for the status quo that we don’t need to reinvent the wheel, but I would submit, that this is precisely what is required at this historical juncture. We also hear about thinking out of the box, but we see precious little evidence that anyone in St. Paul has any concept of what that means.

  2. Just looking at her face makes me want to curl up and hide.

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