Tax bill 2014: Part two

Ten days ago, Governor Dayton signed into law the first tax act of 2014, which focused largely—but not exclusively—on time-sensitive items which needed to be enacted quickly. That act disposed of about half of the projected FY 2014-15 budget reserve through tax reductions and budget reserve increases. Now a second tax bill is working its way through the legislature. Last week the House Tax Committee passed its second tax bill of the 2014 session, which now awaits action by another committee before going to the House floor for passage. Some of the provisions of the second House tax bill (as of March 31) are outlined below. Continue Reading

Small business property tax break

In an effort to reduce small business property taxes, a proposal in the Minnesota House would exempt the first $150,000 of taxable value of each business from the state business property tax. This provision is part of a second round of tax legislation, approved by the House Tax Committee yesterday, that was not part of the new tax law enacted last week; that law contained “rush” federal conformity provisions that needed to be enacted in advance of the April 15 tax filing deadline as well as other time-sensitive legislation. The second tax bill currently working its way through the House will contain other tax provisions that are less urgent, but still important. Continue Reading

Tax bill is on its way to the governor

A $432 million tax bill that would conform the state’s tax code to several federal provisions and repeal three business-to-business taxes was re-passed overwhelmingly off the House floor 126-2 on Friday. Earlier in the day the Senate passed the bill 58-5. It now moves to Gov. Mark Dayton for action. He said during a press briefing today that he would sign the measure as soon as it reaches his desk.

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Governor’s tax bill sits at $115 million more than House proposal

There is a little more than $115 million difference between the tax relief put forward by the House and that in the governor’s proposal. However, by the end of the week, that gap could be closed.Tuesday, the House Taxes Committee heard HF3122, the governor’s tax bill, sponsored by Rep. Ann Lenczewski (DFL-Bloomington). Providing $616.56 million in tax relief over the 2014-2015 biennium, Lenczewski said an omnibus tax bill expected to be heard by the committee on Thursday will most likely include provisions put forward by the governor and not already covered in HF1777, which passed overwhelmingly off the House floor March 6.That $501 million proposal awaits action in the Senate where Sen. Rod Skoe (DFL-Clearbrook) is its sponsor.Revenue Commissioner Myron Frans said the governor’s bill would provide:$256.57 million to pay for repeal of business taxes, expand the local government sales tax exemption and increase the fundraising exemption for youth and senior citizen groups;$227.59 million to conform the state to the federal tax code;$88.6 million to expand the child and dependent care credit and extend and increase the angel investment credit; and$42.7 million to repeal the gift tax and increase the estate tax exemption.While both the House and governor address the three business-to-business taxes enacted last session, the governor’s bill would make the repeal effective March 31. The House, on the other hand, makes retroactive two tax provisions that were effective July 1, 2013, kicking in a refund mechanism. (One tax, on warehouse services, will not take effect until April 1.)Rep. Kurt Zellers (R- Maple Grove) questioned the governor’s unwillingness to provide refunds, if the taxes are repealed.Frans said that it would be difficult for the department to set up a proper refund mechanism. Continue Reading

Dayton calls delay on tax bill unacceptable

Minnesota Governor Mark Dayton says he is “very, very, very disappointed that the Minnesota legislature has not passed a tax cut bill. The Minnesota Department of Revenue says the law must be changed soon so that Minnesotans filing their tax returns in April can see the savings.In the video below, Senate Majority Leader Tom Bakk responds to allegations from Governor Mark Dayton that the Senate is delaying a tax bill until the House approves a new home for the Senate. Bakk says that the tax bill has been proceeding swiftly and may come up on the floor this week if Republicans will agree to waive the rules. On a new home for the Senate, Bakk says that he has urged the House rules committee and House Speaker Paul Thissen to approve the spending for a new Senate Office Building since the capitol is being renovated and after the 2015 session the Senate will not have any offices there. Continue Reading

Two tax relief bills that legislators should consider

Yesterday, legislative committees heard two tax relief proposals that deserve serious consideration during the 2014 session. They are Senate File (SF) 2484, which would increase the Working Family Credit and a house bill,* which would provide a one-time increase in the Homestead Credit Refund and the Renters’ Property Tax Refund (PTR). Continue Reading

Property taxes drop for first time since 2002

Statewide property taxes will drop from 2013 to 2014, according to new information from non-partisan Minnesota House staff, heralding the first year-to-year property tax decline in over a decade. Credit for this goes squarely to progressive state policymakers who enacted major property tax relief legislation in 2013, including a new homestead credit refund and significant increases in school aid and other state aid to local governments.

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Dayton’s budget provides more tax relief

Gov. Mark Dayton on Thursday proposed his supplemental budget of tax and spending changes. The governor’s proposal comes after the Minnesota Management & Budget last Friday released the February economic forecast that projected a $408 million increase in the General Fund surplus. The surplus is now pegged at $1.23 billion for the 2014-2015 budget period that ends June 30, 2015.

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