I hope your summer is off to a good start and wish you a happy and safe Fourth of July holiday week.
One of my favorite events each summer is the Fourth of July parade in Erhard. It’s amazing the way this small town swells with visitors for the parade and festivities that follow each year. If you’re an Erhard Fourth of July regular, I hope to see you there. If you’ve never been to the Erhard parade, I encourage you to check it out this year as we celebrate our great nation’s independence. It starts at 11 a.m. Thursday.
On another note, many of the increases in taxes and fees Gov. Mark Dayton and fellow Democrats in the Legislature passed this year took effect today. It all adds up to around $2.5 billion more in taxes and fees. One of my top concerns is how these added costs will hit practically all Minnesotans. In fact, the huge increase in the cigarette tax will hit our state’s lowest earners the hardest.
Here’s a look at today’s increases:
The new 9.85 percent rate on the state’s high-income earners impacts:
Taxes on a pack of cigarettes rose by $1.60 (from the current $1.23 to $2.83).
Vikings stadium bail-out tax
Part of the revenue from the first year of the cigarette tax increase will be used to help make up for the fact e-pulltabs are not generating the amount of revenue necessary to pay for the state's portion of a new Vikings stadium.
Internet purchase tax
A sales tax also has been added for online purchases such as ringtone downloads, music, videos, books and online computer games.
Businesses will have to pay new sales taxes on warehousing and storage (not including mini-storage); electronic and commercial equipment repair and maintenance; and through repealing the current sales tax exemption on telecommunications equipment purchases.
New fee increases are added to driver’s licenses and vehicle registration.
· The option of a $5 wheelage tax has been expanded to include all 87 counties in Minnesota, with the amount increased to $10 in 2014 followed by up to $20 beginning in 2018.
· New law also increases a flat amount charged for some older model collector vehicles (from $90 to $150).
· Starting in 2017, fees for new vehicle titles will increase from $6.25 to $8.25, while a $5.50 title transfer fee is eliminated.
· The filing fee for a new or renewed driver’s license or state identification card is increased from $5 to $8.
Click here to find more information on these tax increases, along with all the other laws that went into effect today.