ST. PAUL – While $1.35 billion in tax relief may garner most of the statewide attention regarding a bill the Minnesota House passed Thursday, legislation of local interest authored by Rep. Bud Nornes, R-Fergus Falls, also is included.
The provision authored by Nornes would allow implementation of the half-cent sales tax Fergus Falls residents approved in a referendum last November to fund construction of a new library.
“The library bill is part of the process that is necessary for the tax local voters approved to go on the books,” Nornes said. “It is one of those things where we should be in good shape with this if and when a tax package is enacted this session.”
As far as top-line items in the $135 billion in tax relief approved by the House in H.F. 4, the single-largest provision is $270 million to reduce the state tax on Social Security income.
“This would be a great benefit to seniors, especially those living on fixed incomes,” Nornes said. “But, overall, there are many good reasons this is a very good tax bill and it ought to be passed very quickly in the conference committee.”
Other provisions in the bill include one that would benefit middle-class families with $35 million going toward modifying the child and dependent care credit. A family of four with childcare expenses would be estimated to receive $660 in relief.
More than $125 million would go toward addressing college affordability. Families saving for college using 529 Savings Plans will benefit from expanded subtractions and credits. In addition, 77,500 students will receive, on average, a $640 reduction in their taxes through a first-in-the-nation tax credit for student loan payments.
Hometown businesses would see $203 million to reduce the extra state property tax on businesses, exempting the first $200,000 in property value from the extra tax on businesses and freezing its automatic inflator.
Farmers also would receive significant relief, with $42 million to reduce the burden agriculture land owners pay for school bond referendums. Farms also would benefit from a measure conforming the state death tax to the federal exclusion.