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Subsidy, corporate tax reaction

Published (4/11/2008)
By Courtney Blanchard
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The public had a chance to weigh in on HF4103, a bill that would eliminate all state corporate subsidies and, in turn, lower the corporate tax rate by one percent.

House Taxes Committee Chairwoman Rep. Ann Lenczewski (DFL-Bloomington) sponsors the bill, which will be considered for possible inclusion in the committee’s omnibus bill. There is no Senate companion.

Lenczewski said at the April 7 meeting that she included provisions to repeal all subsidies indiscriminately. “I made a complete list so we’re not picking winners or losers,” she said.

Testifiers told the committee that research credits help to bring high-paying jobs to the state.

“This is a very important issue as we compete here in Minnesota and across the world,” said Doug Carnival, board secretary of the Minnesota High Tech Association.

Thom Peterson, government director of the Minnesota Farmers Union, said farmers need the bovine tuberculosis tax credit as the epidemic spreads in the state.

“That’s going to mean a lot more testing for farms, it’s going to mean a lot more burden for our cattle producers,” Peterson said. The tests cost between $10 and $12 per head of cattle, and that can quickly add up for farmers with large herds.

Several lawmakers, including Rep. Morrie Lanning (R-Moorhead), said they plan to present bills at an upcoming meeting to expand tax credits for businesses.

“Anything that we do in this tax committee will either help the unemployment rate or continue the growth of it,” said Rep. Dean Simpson (R-Perham).

Lenczewski said the bill would actually help most Minnesotan companies, which do not get corporate subsidies and would have their tax rate lowered. “Or, let’s say you’re not a corporation, you’re paying through the income tax system, your size of government that you have to pay for in your taxes now goes down. You’re a beneficiary.”

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