New laws and a new budget in effect
State Representative Joyce Peppin, R-Rogers, announced that new laws passed during the 2013 legislative session are effect as of July 1, including the new budget tax increases signed by Governor Mark Dayton.
“The month of July brings with it Fourth of July parades, picnics and fireworks, but it also serves as the enactment month for many new laws and a new budget passed by the 2013 legislature,” Peppin said. “For families in the northwest suburbs, that budget includes tax increases that will substantially impact their take home pay and make it harder to make ends meet. I would have preferred a more common-sense, responsible budget that lived within its means. Instead, state government will grow by nearly 10 percent, as the economy recovers slowly at 2-3 percent.”
On July 1 the new $2.1 billion in tax increases also went into effect. This includes a fourth tier income tax rate of 9.85 percent (a 25 percent increase) on small business owners and single filers making over $150,000 or couples making over $250,000. The cigarette tax will increase from $1.23 to $2.83 per pack. To prevent retailers and wholesalers from stockpiling product before that date, a one-time new cigarette tax equal to the tax increase will be imposed on current inventories. The sales tax will expand to internet sales and downloads (like ringtones, music, videos and books) and farm and industrial equipment repairs, and it will increase for car rentals.
Peppin listed other examples of new laws that will come into effect the first of the month, and the potential impact of these statutory changes:
• Long-term care providers will see a five percent cost of living pay raise, a well-deserved increase for those who care for our seniors and those with disabilities.
• State funded all-day kindergarten is enacted, but some school districts will struggle to support the infrastructure needed for more students under this mandate.
• The transportation budget saw a significant funding increase, with much of the additional money dedicated to subsidizing Metro Transit operations and to pay cash for Southwest light rail capital costs. However, critical infrastructure projects on major highways and interstates were not funded, and vehicle owners will have to pay for increased fees on vehicle titles and driver’s licenses, as well as a doubled wheelage tax.
• The high school GRAD tests have been replaced and now high school students will take — but not have to achieve a minimum score on – a new set of tests in reading, writing and math.
• The state’s first solar energy production standard will require Minnesota’s largest utilities to procure or produce 1.5 percent of their energy from solar installations by 2020. The new costs to utilities will be passed on to consumers.
• The Sunset Commission that was meant to review and eliminate wasteful government agencies and boards will phase out.
“Depending on your point of view, this budget will either bring stability to the tax system or penalize hardworking families and serve as an impediment to economic growth,” Peppin stated. “My view is that a bigger budget doesn’t necessarily mean a better budget. The economic improvements over the past two years are convincing evidence that when we let the private sector thrive and grow, and make government work for the people and not the other way around, our economic quality of life improves.”
Peppin invites and encourages constituents to contact her throughout the summer months. She can be reached at email@example.com, 651.296.7806, or 281 State Office Building, 100 Martin Luther King Jr. Blvd., St. Paul, MN 55155.