Democratic negotiators in both the House and Senate have struck a deal on a $3 billion tax bill, one of the last hurdles before adjournment of the legislature which is on Monday at midnight.
The plan provides for tax rebate checks of $260 for singles making $75,000. Married couples making up to $150,000 a year would get $520. Children would get $260 dollars each, for a max of $1,300 per family.
WCCO Political Analyst Blois Olson says while it looks like a done deal, there might be more changes.
“The tax bill is agreed to, but if one of these other bills needs to come up with more revenue of some sort, then they have to reopen the tax bill and find that new revenue,” Olson explained on the WCCO Morning News with Vineeta Sawkar.
There are also new tax credits for families and low income households, and taxes on Social Security will be eliminated for couples who make up to $100,000 a year, which is a higher threshold than previously floated but not the total elimination that some in the DFL and most Republicans wanted.
While Democrats call the bill the largest tax cut in history, Republicans say it's also a large tax increase. Almost $500 million a year will mostly be paid for by corporations along with higher taxes in dividend and investment income for high earners.
“When you look at the whole picture, with the $17 billion surplus, there’s a $2 billion tax increase in the bill too,” says Olson. “The idea that the folks who really contributed more in tax revenue to the state and helped build the surplus, are getting the least back.”
Republicans in the House and Senate are saying that with such a large surplus, Minnesotans should be “upset” that they’re not getting more money back.
“Minnesotans should feel outraged with what’s happening at the State Capitol right now,” says Senate Minority Leader Mark Johnson (R- East Grand Forks). “It’s runaway tax season down here.”
“The governor promised them a lot more,” said Senate Assistant Minority Leader Karin Housley (R- Stillwater). “It makes absolutely no sense. In the last six years we’ve had some divided government and we tried to do some tax cuts year after year. And then after six months of a Democratic majority, it’s a runaway train of spending and taxes.”
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