Last week, state economists revealed that Minnesota’s economic outlook has improved significantly in recent months. What was once a projected $1.3 billion budget deficit has now turned into a $1.6 billion budget surplus.
On its face, it is good news that we no longer have a deficit to grapple with and shows that not only is our economy recovering, but our current tax levels are more than sufficient to fund the priorities of Minnesota families.
Despite our newfound budget surplus, Governor Walz and Democrats continue to advocate for substantial tax increases that would impact Minnesotans of every income level. Among these are hikes to the state’s business tax rate, income tax rate, and more. The business tax proposal would provide a 15% increase to our current rate—bringing Minnesota to the second-highest business tax rate in the entire nation.
It is reckless and irresponsible to press forward with tax hikes in the face of our economic recovery. Doing so will only hurt the people who have already been hit hard over the last year. We must make sure that state government shares in the sacrifice that so many have had to endure over the past year.
The news of the budget surplus also brings up an important reminder that while the state’s economic outlook is generally optimistic, the pace of the recovery has not been equal for all Minnesotans. Low-income Minnesotans, main street businesses, and others continue to suffer as Governor Walz’s one-size-fits-all shutdowns wreak havoc on small businesses.
This disconnect has been illustrated by the recent debate in St. Paul over exempting Paycheck Protection Program (PPP) loans from state taxes.
The federal Paycheck Protection Program provided forgivable loans to small businesses that were struggling to stay afloat during the worst of the pandemic. These 100% forgivable loans allowed businesses to keep their doors open and staff employed despite the significant financial losses that were being incurred at the time.
These loans are not taxed at the federal level or by any of the other states in the upper Midwest, except for Minnesota. This puts Minnesota businesses at a competitive disadvantage and will significantly harm small business owners that employ our neighbors and families. We cannot delay and let this important fix get caught up in end-of-session political games. It is time to act, now.
With COVID-19 cases plummeting, deaths falling, and more vaccine options coming to market, Governor Walz is running out of reasons to justify his stranglehold on Minnesota government via emergency powers. After a year of one-person rule, it’s time for Governor Walz to hand over his power, work with the legislature as we respond to the pandemic, and let Minnesotans make decisions for themselves and their families without the heavy hand of government dictating to them what they can and cannot do.
We have been living with COVID-19 for over a year and now understand how to protect ourselves, our families, and our neighbors. It is time for the Governor to trust Minnesotans to live their lives responsibly.
Staying in Touch
Please do not hesitate to contact me to share your thoughts and concerns regarding state government. I can be reached by phone at 651-296-4333 or via email at email@example.com.