Accessibility menu
State Representative Paul Marquart
100 Rev. Dr. Martin Luther King Jr. Blvd.
651-296-6829
For more information contact: Sandy Connolly 651-296-8877
Press/News Releases
HOUSE TAX BILL SIMPLIFIES TAX SYSTEM, INCREASES TAX FAIRNESS
St. Paul, MN – The House Tax Committee presented their 2009 Tax Bill in committee today, paving the way for the most significant tax reform seen in over 20 years. The proposal simplifies Minnesota’s outdated tax system, retains and grows jobs, and increases tax fairness for state taxpayers.
“This bill shrinks government by removing permanently a number of tax preferences in the tax code," said Lenczewski. “It’s really about trying to reform the tax code, increase fairness and progressivity, keep and grow jobs in Minnesota, and to recoup some government costs that we are currently not recouping at the level they're costing Minnesotans.”
If enacted, the tax bill would eliminate dozens of subsidies that are outdated, regressive or too expensive. It also contains provisions aimed at providing Minnesota companies a competitive advantage and looks to the future by doubling the Research and Development Credit and expanding eligibility.
“Our state is facing a historic budget deficit, the likes of which we have never seen before,” said Lenczewski. “As the tax committee worked to address this shortfall, we looked for answers to these three questions: what isn’t working, what can’t we afford, and what isn’t fair. The final bill we presented today meets those benchmarks.”
A key component of the bill is a county reform initiative, legislation that provides counties with an alternative to raising property taxes or cutting essential services to recoup proposed cuts to county aid. This proposal would give counties the option of imposing a ½ cent sales tax that could be removed by voters through a reverse referendum.
“Minnesota homeowners are reeling from over $3 billion in property tax increases over the past few years,” said Marquart. “They told us loud and clear they no longer want business as usual; this bold and serious initiative offers them both relief from more property tax hikes and increases local revenue to protect the fundamental local services Minnesotans value.
At a time when families are struggling with loss of income, loss of health insurance, and rising prices, it is feasible for them to reduce their spending on taxable items; however, it is not possible to reduce the amount of property taxes they pay. This proposal provides that option.”
The legislation creates a new fourth-tier income tax bracket for married joint filers making over $300 thousand a year. The 2009 Minnesota Tax Incidence Report revealed that Minnesota’s tax system has become more regressive, with higher income earners paying lower effective tax rates than lower-income earners. The 2009 Tax Bill brings more balance and fairness to Minnesota’s income tax system.
“We’re not asking high-income earners to pay more than everyone else, just a closer percentage in taxes to what lower and middle-income earners are paying,” said Lenczewski. “When you consider the facts, it would be hard to argue against the fairness of this change.”
The bill also recoups some government costs by increasing the cigarette tax – to the same level as Wisconsin, as well as proposing the first increase on alcohol in over 20 years. If enacted, consumers would pay an additional 1 – 3 cents per drink.
Overall, the House Tax Bill generates $1.5 billion in new revenue to address Minnesota’s $6.4 billion budget deficit. The Governor’s budget proposal includes $1 billion in new revenue through a 20-year loan.
News Items
- Marquart Selected to Chair House Education Finance Committee - (Posted: 2012-11-16 00:00:00)
- 2012 SESSION UPDATE - (Posted: 2012-05-15 00:00:00)
- May 15th deadline to pay property taxes stings Greater Minnesota homeowners, business owners and farmers - (Posted: 2012-05-15 00:00:00)
- Archived News Items
- Subscribe to RSS News Feeds
- Read more about RSS.