Say Measure Ensures No New Income Taxes on Individuals, Puts Money Back in Pockets of MN Families, Invests $325 Million In Public Safety
ST. PAUL, Minn. – Senate Tax Chair Ann Rest (DFL-New Hope) and Vice Chair Matt Klein (DFL-Mendota Heights) said the Senate Tax bill released today includes $4 billion in tax cuts over four years for Minnesotans, no new income tax increases, and $325 million in funding to bolster public safety in every community across the state.
Senators Rest and Klein said the bill, announced Tuesday evening, represents the largest set of tax cuts in state history, with a focus on putting money in the pockets of Minnesota’s middle-income families and individuals. It also sends funds to local governments to keep property taxes down and to focus on public safety.
- $1.1 billion of the surplus goes back to Minnesota taxpayers this year through one-time refundable tax credits totaling $564 per couple with income up to $150,000. Single filers with income up to $75,000 would receive a $282 rebate. Taxpayers with children would get an additional $56 for each child, up to three children.
- $1.3 billion over four years in tax relief through a new Child Tax Credit equal to $620 per-child for up to three children under age 18 or dependents with disabilities. The credit applies to families making up to $80,000 and will greatly reduce child poverty across the state, the lawmakers said.
- $ 1.1 Billion reduction in Social Security taxes over four years, eliminating the tax for couples earning up to $100,000 and individuals earning up to $78,000. Under this provision, 76 percent of Minnesotans with Social Security income will not pay taxes on that income. Seniors, who receive public pensions instead of Social Security because they worked jobs such as state troopers, firefighters, public safety officers, and some teachers will be able to subtract up to $25,000 of those benefits if they make less than $120,000/year.
- Property tax relief for homeowners, farmers, and small resort owners squeezed by fast-rising property values, and up to $2,000 refunds for homeowners whose property taxes increase more than 10 percent and $100 in one year.
- $907 million to help Minnesotans pay childcare costs. Taxpayers earning up to $160,000 could qualify for a maximum $12,500 tax credit, depending on the age of their children and total childcare expenses in a year. Couples earning up to $200,000 continue to qualify for a phased-out credit. Families with young children ages 0 to 5 receive a larger credit to compensate for the extraordinary cost of care for these young children.
Public Safety Prioritized in Senate Tax Bill
The Senate tax bill also includes $325 million to address public safety needs in communities across the state. Of that amount, $300 million will go to local governments in one-time funding to bolster their efforts to address urgent public safety needs. The remaining $25 million is set aside over the next five years for grants to local governments to fund criminal investigations and to help law enforcement respond to mental health calls.
“The Senate tax bill prioritizes $4 billion in tax cuts for Minnesotans, putting money back in the pockets of families across the state,” said Chair Rest. “It has no new income or sales taxes for individuals, and it bolsters public safety in every Minnesota community. In this bill and others traveling through the Senate, we are providing local governments across the state with at least $1 billion over the next four years to provide consistent, quality local services and keep property taxes down.”
“Minnesotans have told us time and again that they want us to address rising costs and help those who are struggling,” said Vice Chair Klein. “By putting money back in the pockets of families across the state we are doing just that with this tax bill. We’re focused on helping people with everyday costs such as childcare expenses, property taxes, and energy costs. This bill also cuts social security taxes, giving ongoing relief to many Minnesota seniors.”
The bill also allows the state to pay off the stadium 23 years early, which provides about $220 million in interest cost savings to Minnesota taxpayers.
They said the bill raises revenue on multinational corporations, leveling the playing field for Minnesota’s main-street businesses that can’t shift income to avoid paying taxes.
The two lawmakers said the bill will be presented to the Tax Committee starting at 8:30 a.m. on Wednesday in room G-15 in the State Capitol. There will be a short media availability following the presentation.