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Legislative News and Views - Rep. Steve Green (R)

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Legislative Update (1-29-21)

Friday, January 29, 2021

Dear Neighbor, 

Gov. Tim Walz this week issued his budget proposal for the upcoming biennium. It includes $1.7 billion tax increase, with a 15% tax increase on businesses and a 10% hike on Minnesota’s top tax bracket. This would give Minnesota the nation’s second-highest business tax and third-highest income tax rates. 

The governor’s proposal only calls for minor spending reductions, but those “cuts” are largely savings from sources such as state prescription drug costs – in part because people have not been as regular in scheduling doctor’s appointments during the pandemic. 

While the governor is selling his tax increases as making the rich pay their “fair share” (and the media has reported it hook, line and sinker), this is just regurgitated liberal talking points that divide people and pit us against one another, paving the way to take more money from citizens while ignoring the state’s own irresponsible spending habits.  

What is not being said enough is the governor’s tax increase would impact all of us. The Minnesota Department of Revenue’s own numbers confirm that corporate taxes result in increased taxes on low- and middle-income families, with 43% falling on Minnesota consumers through higher prices, 43% on other state consumers/employees, and 5% on employees (layoffs, wage reductions, reduction of hours, etc). Put another way: corporate tax increase end up falling only 9% on the company (owners/shareholders) and 91% on consumers and employees. 

The governor’s plan also raises regressive taxes (including on cigarettes and vaping products), impacting lower earners the most. Overall, $941 million in the governor’s $1.7 billion tax increase are regressive taxes that will impact Minnesotans of every income level. 

The governor’s budget plan is just the same, tired liberal approach. When times are good, they want to raise our taxes. When times are bad, they want to raise our taxes. They always want to raise our taxes. It’s the same old excuses we’ve heard time and again.The state needs to share this burden. People already are hurting financially in large part because of shutdowns the governor placed on our workers and now he wants to raise their taxes and cover his tracks.

The good news is the governor’s budget proposal is merely the first step in a months-long process to set our state’s new biennial budget, which will go into effect July 1. We will receive an updated economic forecast for our state approximately one month from now and those figures will serve as the framework for budget plans put forth by the House and the Senate. The governor then will take the updated figures into account and come back with an adjusted proposal. 

As for legislative news, of the more notable subjects in the House this week relates to a committee hearing which took place for H.F. 278. This bill creates a new “carbon-free” electricity mandate with a requirement for 100 percent carbon-free electricity in our state taking effect in 2050 (2045 for Xcel Energy).

There are so many bad provisions in this bill it’s hard to know where to start. It would raise energy rates on Minnesota families, reduce the reliability of our power grid, and continues to exclude key technologies like hydro and nuclear. All this comes at a time the governor is pushing to mandate more electric cars on our roads, increasing energy demand.


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