|
|
Dear Friends and Neighbors,
I hope everyone stays warm this weekend – it could get as low as -15! This is why we are hearty Minnesotans! 😊I’m looking forward to spending time catching up on reading and watching the Super Bowl with my family.
|
|
Executive Summary
- More details on Governor Walz’ tax proposals
- SAFE Account
- Mask Mandate Bill
- Maria’s Voice Events to raise awareness of domestic violence
- Helpful Links – Legal resources, Career Options, New Small Business Loans
|
|
Update on Governor Walz’s Tax Proposals
Many people have reached out to me to ask for more details on the tax proposals the Governor rolled out in his budget last week. We had a hearing on this in the Tax Committee yesterday and I wanted to share additional details from the Dept. of Revenue with all of you:
The Governor’s $54.4 billion budget is a 9.4% increase over the last biennium. It takes $1 billion from the state’s “rainy day” fund and raises $1.7 billion in revenue over FY22-23. Of this $1.7 billion in tax increases, $941 million, or 55.4%, are regressive – which means they impose a higher burden on lower-income households than higher-income households.
Tax Credits/Cuts:
-
Increases the Working Family Credit and expands it to allow an additional 10,800 households that use Individual Taxpayer Identification Numbers (ITINs) to qualify. The average increase per household would be $160. This would be indexed to inflation and would cost $124.2 million over 2 years.
-
Expands the 1st Tier Individual Income Tax bracket by lowering the income threshold for the 2nd Taxpayers who currently pay in the 2nd Tier would have a tax decrease, because more income will be taxed at 5.35% than 6.8%.
- This will affect approximate 1 million Minnesotans who would receive an average tax cut of $36.
- This would cost $95.2 million over the first two years.
- Allow Individual Taxpayer Identification Number (ITIN) payers to qualify for homestead property tax refund.
- Makes an additional 1,900 homeowners eligible for this refund.
- Costs $3.6 million in FY22-23.
-
Angel Investor Tax Credit - $7 million for FY22. Does not extend into FY23.
Tax Increases:
-
Creates a Fifth Income Tax Tier: Minnesota currently has 4 income tax levels – the proposed 5th Tier is highlighted below. This would apply to small businesses and farmers who are S-corps, LLCs and LLPs who “pass through” their business income and pay individual taxes. Adding this 5th tier would give Minnesota the 3rd highest income tax rate in the country.
Tax Rate Married/Joint Single
5.35% $0 < 39,410 $0 < 26,960
6.80% $39,410 < 156,570 $26,960 < 88,550
7.85% $156,570 < 273,470 $88,500 < 164,400
9.85% $273,470 and above $164,400 and above
10.85% $1,000,000 and above $500,000 and above
- This 5th Tier will affect over 21,000 households and their average tax increase will be $8,072 per return.
- It will increase state revenues by $402.7 million in FY22-23.
-
Capital Gains Tax: Adds a surcharge to long-term capital gains (held over 1 year) and qualified dividends of individuals, trusts, and estates:
- 5% on capital gains/dividend income between $500,000 - $1 million.
- 4% on capital gains/dividend income over $1 million.
- This will affect 7,000 households, whose average tax increase will be $30,000 per return.
- It will increase state revenue by $486.1 million in FY 22-23.
-
Corporate Tax Increases: This is a 15% increase on Minnesota businesses and it includes all C-corporations, including small businesses and farms organized as a C-corp. It would give Minnesota the #2 highest corporate tax rate in the nation.
- Increases the corporate tax rate from 9.8% to 11.25%, which will increase state revenue by $423.8 million in FY 22-23.
- Creates a tax on foreign income that is repatriated to the U.S., which will raise $336.23 million in FY 22-23.
- According to the Dept. of Revenue, Corporate Taxes are ultimately paid by consumers and employees in the form of higher prices and lower wages. These taxes are considered regressive.
-
Estate Tax Increase: Lowers the exemption from $3 million to $2.7 million. This applies to small businesses and farms and is expected to raise state revenue by $28.1 million in FY 22-23.
-
Cigarette and Vaping Taxes:
- Increases cigarette taxes by $1, from $3.04/pack to $4.04/pack. This is expected to raise state revenue by $138.75 million in FY22-23.
Creates a gross receipts tax on vape products and delivery devices, which would increase state revenue by $11.61 million in FY 22-23.
|
|
SAFE Account
Gov. Walz proposed the creation of a SAFE (State Aid for Emergencies) Account which would create a $35 million fund to reimburse local governments in the event of public unrest. Specifically, this money would be used to assist Minneapolis during the upcoming Derek Chauvin trial.
My colleagues and I will always stand with law enforcement. We want to make sure that they have the resources they need to effectively do their jobs and keep our communities safe. I supported reimbursing the Minnesota State Patrol and the Minnesota National Guard for actual expenses they incurred when they helped quell the violence in Minneapolis and St. Paul last summer. That was unforeseen and they stepped up without hesitation.
Since then, however, rather than improve the security situation in Minneapolis, the Minneapolis City Council voted to cut their police budget by $8 million. In addition, the City’s police force is down 200 police officers from the number they had at this point in 2019 and they have not funded replacements for these officers.
The actions the Minneapolis City Council has taken to defund and reduce the size of their police department should not be shifted to taxpayers throughout the state. It is their responsibility to adequately fund public safety in their jurisdiction.
The SAFE Account also ignores an underlying problem our communities face. The Minnesota Police and Peace Officers Association, the Minnesota Sheriffs Association, and the Minnesota Police Chiefs Association wrote a letter to the Public Safety Committee stating "Our members remain concerned...that no matter what legislation is passed, the response for mutual aid will not be as robust as the public may expect. Our members’ concern is due to the continued demonization of law enforcement officers by certain public officials at various levels of government."
The anti-police sentiment fostered by Minneapolis officials will make other agencies less likely to respond to request for help. We need to consider the safety of protestors and the officers who protect their First Amendment rights.
|
|
Mask Mandate Bill
A bill was introduced this week requiring face masks for Minnesotans aged 5 and older in public settings. If enacted, individual mask violations by those aged 13 and up would be guilty of a petty misdemeanor and could be fined up to $100. Any business not in compliance would face a criminal penalty, a fine up to $1,000, and may serve up to 90 days in prison.
The bill does not include an expiration date and only states that it would expire once the CDC and MDH have deemed mask wearing no longer essential for stopping the spread of COVID-19.
You can read the full text here. This is an extreme overreach of government authority that I will oppose.
|
|
Maria's Voice
Maria's Voice is a new organization in our community that was started last year in the wake of Maria Pew’s death due to domestic violence. Founded by Maria’s family, the group helps those who are impacted by domestic abuse and promotes safe homes and healthy relationships. They were featured on Kare 11 and have several upcoming events to help raise awareness. This coming Monday, Feb 8th, they are hosting a Sweepstakes and Fundraising Day at Wahlburgers. On Saturday, February 13th, they are having a Maria's Voice Launch Event. You can find more information about their upcoming events here.
|
|
Helpful Links - Legal Resources & Career Options
I always want to be a resource for you, so I wanted to share with you some websites I have found to be helpful.
Legal Help: LawHelpMN.org provides free legal advice and has some excellent resources on its website. It is run by the Minnesota Legal Services Coalition, a group of seven legal aid programs that help low-income residents with legal matters.
Finding New Career Opportunities: The Occupational Mobility Explorer at PhiladelphiaFed.org has several great resources for those looking for a new career. This tool evaluates the skills employers are looking for in 33 metro areas, including the Twin Cities, to identify opportunities for workers to transfer their skills to similar, but higher-paying jobs. Job seekers can use the Build Your Path feature to view occupations with similar skills and pose at least a 10% wage increase. The Compare Skills page allows people to compare the 25 most in-demand skills for any occupation in a metro area. The View Top Transitions feature allows job seekers to compare data between similar occupations.
Targeted EIDL: Small business owners should know that the SBA has a new program, Targeted Economic Injury Disaster Loan (EIDL) Advance, to help those companies that received little or no funding when the program first started in March. The SBA started reaching out to businesses this week to apply for these grants. To qualify, small businesses must be located in a federally designated low-income community, have a 30% reduction in revenue over an eight-week period after March 2, 2020 compared to the same period in 2019, and have 300 or less employees. Any questions should be directed to the SBA’s Customer Service Center at 1-800-659-2944 or TargetedAdvance@sba.gov.
|
|
Photos
Meeting in person at Daily Dose
I will be holding office hours next Friday, Feb 19. Email my LA for the Zoom link at chris.mulcahey@house.mn
|
|
Please Contact Me
Many of you have already been in touch to discuss your thoughts on the issues that matter most to you. Thank you for sharing your ideas! Please continue to contact me to discuss any matters to which I can be of assistance.
During the continuing COVID restrictions, the best way to reach me is by email: rep.kristin.robbins@house.mn. You can also leave a voicemail on my office number, 651-296-7806, which is checked a couple of times/day. I hope you all have a great weekend!
Have a great weekend!
Kristin
|
|
225 State Office Building
100 Rev. Dr. Martin Luther King Jr. Blvd.
Saint Paul, MN 55155
ph: 651.296.7806 |
|
|
|
|
