Minnesota budget officials released the state’s economic forecast on Thursday, projecting a $1.5 billion surplus going into the next biennium.
“Minnesota’s budget and economic outlook remains sound, despite slower growth through the budget horizon,” Minnesota Management and Budget said in a press release.
The state’s budget reserve — commonly known as the “rainy day fund” — will also receive a boost from the surplus of over $491 million, bringing the total to a record high of over $2 billion.
Despite a large surplus and swelling “rainy day fund,” Democrats are poised to raise taxes on Minnesotans. In a press conference Thursday, Governor-elect Tim Walz said it would be “irresponsible” to take tax increases off the table. One of those tax increases is a gas tax hike — something Walz refuses to rule out, saying a one-time infusion of money will not address the state’s transportation infrastructure needs.
Republicans, on the other hand, say the significant surplus — a result of overtaxing — is proof Minnesotans deserve tax cuts. House Republican Leader Kurt Daudt (R-Crown) said “today should be the last time anyone around the Capitol talks about raising taxes this session.” Senate Majority Leader Paul Gazelka shared similar sentiments, adding that legislators should “do more to make sure families can keep their hard-earned money.”
“The last budget passed by the Republican-led legislature, combined with the hard work of Minnesota workers, led to today’s surplus,” Gazelka said. “We clearly won’t need tax increases to fund Minnesotans’ priorities in 2019, and we should do more to make sure families can keep their hard-earned money.”
Read the full budget forecast here.
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