Calls it largest tax hike in state history
by REP. JOE MCDONALD
MINNESOTA HOUSE DISTRICT 29A
The budget proposal issued by Gov. Mark Dayton includes two things Minnesota does not need right now: $3.7 billion more in taxes and $2.7 billion more in state spending.
Governors do not officially author budget plans, they offer blueprints to the Legislature. Dayton’s proposed tax increase would be the largest in state history. But Democrats now hold majorities in both the House and the Senate. I am concerned because a whole new array of taxes would go into place if they follow the governor’s plan. His new taxes would include these items and more:
• Clothing purchases of items $100 or more
• Car repairs
• Aspirin and other over-the-counter medication
• Internet purchases
• Cigarettes (94 cents more per pack)
• Increasing the top income-tax rate to 9.85 percent (a two percent hike)
• Dance lessons
These taxes are not good for the middle-class many of us are trying to protect. This, at a time when most Minnesotans are taking home a smaller paycheck after the federal government allowed payroll taxes to increase.
The governor’s plan also would not fully repay money owed to our schools until 2017. This should be a top priority, and it disappoints me that our governor suggests waiting that long to pay back what is owed to our children.
State officials indicate Dayton’s plan would cost Minnesota’s business owners more than $1.5 billion in new taxes. This would be damaging and, as a small-business owner myself, it is very discouraging.
We were able to balance the budget without raising taxes two years ago. Now our state’s economy is rebounding, with unemployment down to 5.5 percent and revenue on the rise. We can eliminate the $1.1 billion projected shortfall without tax increases by keeping state spending to within the limits of our predicted revenue increase, a few percentage points.
Updated economic information will be available in our February forecast, helping us to develop a formal budget. In any case, I will continue advocating for a budget which protects working Minnesotans and stays within the limits of our already-growing revenue. The governor’s plan does neither.