Minnesota Legislature Approves Republican Tax Bill
Rochester, MN (KROC AM News) - A large tax bill was approved by the Minnesota Senate early Thursday with bipartisan support.
The bill mainly cuts taxes, rather than raise them.
According to the Senate Republican Caucus, the $944-million bill was designed to jumpstart the Minnesota economy and help workers and small business owners recover from the COVID-19 pandemic.
The caucus says the bill includes full conformity to federal tax rules for the forgivable Paycheck Protection Program loans many businesses used to survive the pandemic, including deductions for expenses, and full conformity for federal pandemic unemployment benefits up to $10,200.
Rochester Republican Senator Carla Nelson worked on the bill while serving as chair of the Senate Tax Committee.
“There is simply no reason why we should ask folks to pay taxes on this emergency assistance. Businesses relied on these loans to keep people employed during the worst of the pandemic, and many of them are still struggling. Individuals were forced off the job through no fault of their own, and they depended on the extra unemployment to help make ends meet. Providing this protection is one of the most important things we can do to help employees and employers recover from pandemic-induced economic hardship.”
Nelson says job creators and business owners will see lower property taxes as a result of this bill. The bill also replenishes $491 million that was borrowed from the state budget reserve two years ago and provides relief to Minnesota contractors for their June accelerated sales tax payments.
Other highlights of the bill:
- Establishes with Frontline Worker Grant program working group to make recommendations on the disbursement of $250 million as a direct cash benefit to frontline workers. COVID relief funds from the federal government can be used to benefit those workers who were put at risk as they continued to work during the pandemic. The working group will be tasked with defining eligible workers and the matching benefit, which the full legislature will then adopt.
- Financial support for the Oriented Strand Board (OSB) project in Northern Minnesota. The OSB was recently approved to receive $15 million in funding from the Iron Range Resources And Rehabilitation Board and this crucial project will bring hundreds of direct and indirect jobs to the community.
- The bill extends the Angel Tax Credit by $5 million, which encourages investments in startup companies focused on high technology, new proprietary technology, and other groundbreaking fields.
- The bill extends the Historic Structure Rehabilitation Credit, the hugely successful job-creating tax credit that helps rehabilitate historic buildings. A study found that every $1 spent on the tax credit generates $9.50 in private sector economic activity.
- The bill emphasizes affordable housing and workforce housing with a new tax credit to bring private money into the marketplace.
- The bill provides annual aid payments to counties to address student homelessness
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