ST. PAUL, Minn. — Senate Republicans, who rolled out the initiative “Advancing Minnesota” earlier this year have introduced their plan for tax relief.
The “Pro-Growth Tax Relief” plan would make sure every tax paying Minnesotan receives some sort of permanent tax break. The plan would look to aid residents in out-of-state Minnesota, bring tax relief to the middle class, and boost the economy by helping small business owners.
“This is the first permanent cut in rates in 17 years. So Minnesotans are ready for the relief,” said Sen. Roger Chamberlain (R-Lino Lakes), Chair of the Senate Tax Committee.
Chamberlain announced the plan would bring relief to all types of Minnesotans. “Rural, metro, small businesses, large businesses, schools, and farmers, amongst others.”
While senate Republicans announced the plan was a two-part system looking to provide relief to the middle class and boost the economy, lawmakers invited three Minnesota residents from greater Minnesota to explain why the Republican tax plan would help them and their communities. All three men spoke of how the new tax relief plan would ease the burdens of those in the agriculture business.
“Two years ago, young farmers out there had to decide whether to pay for health care or pay the taxes to keep the farm,” Jerry Nordick of Breckenridge, Minnesota said, “That’s how serious this is.”
The plan itself calls for $900 million in tax relief, which Senate Majority Leader Paul Gazelka (R-Nisswa) acknowledged is three times the size as proposed by Governor Mark Dayton (D-MN).
The biggest chunk of the $900 million will come from the rate cut, according to Chamberlain. Republicans seek to create a permanent cut to the lowest tax rate bracket, which would benefit all tax paying Minnesotans – approximately 81 percent of the state’s population. The goal is to target middle-class families making less than $135,000 a year.
Republicans would also phase out social security income tax for seniors making less than $120,000 a year and a tax credit for college students paying off student loans.
In an effort to boost the economy, Republicans propose a property tax credit for farmland owners in an effort to reduce the burden felt by growing school district levies.
“We have a serious problem in rural areas when schools pass building bond taxation. We are in a school district that passed a $19.8 million referendum,” Nordick said, “Most of the farmers in that district saw their taxes go up 98.6 percent. For an 800-900 acre farm, that accounts to $10,000-$12,000.”
Nordick further explained since the referendum lasts for 30 years, it would wipe out a 401K.
Republicans also seek to change the estate tax so more money is left to a person’s surviving family, and provide tax incentives for small business to purchase new equipment.
Gazelka says the bill is about rewarding Minnesota residents.
“Lower taxes put more money into the economy to promote business investments, innovation, and higher productivity so all Minnesotans can take care of their families,” he said.