Minnesota Senate passes tax bill with Social Security cuts, one-time rebates
The Minnesota Senate passed its tax bill on Tuesday night, which includes provisions for Social Security income tax cuts and one-time tax rebates. The DFL-backed bill passed along party lines 34-33. The Minnesota House passed their bill on April 27. The House and Senate will have to reconcile their differences before sending a unified tax bill to Gov. Tim Walz’s desk.
Senate Tax Committee Chair Ann Rest, DFL-New Hope, touted the bill as “the largest package of tax cuts in state history,” claiming it provides $4 billion in tax cuts, credits and rebates.
Under the proposal, single taxpayers earning up to $75,000 would get a $279 rebate, with couples receiving $558 for households earning $150,000 or less. That’s slightly more than what was proposed in the House. Taxpayers would also be eligible for an extra $56 per child for up to three children.
RELATED: Track the Minnesota Legislature’s progress throughout the session with the KSTP Minnesota Legislative Tracker.
The Senate’s tax bill includes reductions on Social Security income tax for most seniors but doesn’t eliminate it entirely, as Republicans have been calling for.
In a statement sent Wednesday, Senator Grant Hauschild (DFL) -Hermantown, said he was proud to vote for the largest tax cut in state history.
“This bill includes so many items that I pushed for this session: My child care tax credit, local government aid and county program aid that will reduce property tax burdens, $325 million to improve public safety, and eliminating Social Security taxes for 76% of Minnesota’s seniors,’ Senator Hauschild stated. “During the floor debate, I voted in favor of an amendment to fully repeal the tax on Social Security tax for all seniors. While that amendment was not added to the Senate Tax bill, I will keep pushing to make sure that the progress we’ve made on removing the Social Security tax is included in the final bill following negotiations with the House of Representatives.”
Senate Minority Leader Mark Johnson, (R) -East Grand Forks said it was disappointing that Senate Democrats could not agree to give seniors a tax cut.
“The fact that Democrats can’t find it in their $72 billion budget — a growth of 40% — to give seniors a tax cut is very disappointing,” Senate Minority Leader Mark Johnson, R-East Grand Forks, said in a statement. “It’s [a] broken campaign promise. There are 33 votes for a clean repeal of the tax on social security from Republicans, but not one Democrat would join us. That’s something I hope everyone hears about when they go home.”
The bill also includes a Child Tax Credit of $620 per child for up to three children for families making $80,000 or less.
Other highlights include a measure to pay off U.S. Bank Stadium early and imposing a multinational corporation tax that would require companies to pay Minnesota tax on overseas profits, a move that Republicans labeled as a “risky move” that could compel companies to move their operations out of the state.
Republican amendments to expand sales tax exemptions for baby products and prohibit the state from collecting information on sales tax-exempt firearm storage purchases were bundled into the final bill.