ST. PAUL – Simplifying Minnesota’s tax code and providing additional tax relief to middle-class Minnesotans is the goal of legislation that was recently approved by the Minnesota House.
State Representative Paul Torkelson (R-Hanska) joined the bipartisan majority in passing the legislation, which would prevent headaches for tax filers next year and make the first income tax cut in nearly 20 years.
“Passage of the federal tax relief bill instigated the need to rewrite Minnesota tax law in a substantial way to treat people as fair as we possibly can,” Torkelson said. “It’s a very important bill to make sure the playing field stays as even as possible.
Torkelson said that under the House bill, more than 2.1 million Minnesota filers will benefit from a tax cut in tax year 2018.
Other highlights include:
Helping middle-class Minnesotans keep more of what they earn by cutting the second tier income tax rate from 7.05% to 6.75% by tax year 2020.
Lowering taxes for people at all income levels by increasing the standard deduction from $13,000 to $14,000.
Protecting families by preserving a state personal and dependent exemption of $4,150.
Encouraging affordable homeownership by allowing a state-itemized deduction of up to $30,000 in property taxes.
Supporting hometown businesses and farmers by reinvesting extra revenue from corporate tax changes into Section 179 conformity and overall rate reductions.
Alternatively, Torkelson said the Governor has outlined a proposal that increases taxes on all classes of Minnesotans – from the poorest to the richest and everyone in between - by more than $1 billion.
The House tax conformity plan now heads to the Minnesota Senate for further debate.