Gov. Dayton released his budget and tax proposals this morning to the 2013 Legislature. The two-year budget plan would increase spending from $36.8 billion to $37.8 billion.
Here are some of the highlights.
• Cuts the sales tax rate from 6.875 percent to 5.5 percent
• Extends the sales tax to clothing costing more than $100
• Extends the sales tax to legal, accounting services
• Increases income taxes on couples with taxable income of $250,000 or more. Single filers at $150,000 or more; the new bracket would be 9.85 percent, compared to the top rate now of 7.85 percent
• Raises cigarette taxes 94 cents per pack
• Provides property tax relief through a $500 rebate for Minnesota homeowners
• Reduces corporate tax rate by 14 percent, from 9.8 percent to 8.4 percent
• Increases education spending by the following:
-- $240 million more for higher education;
-- $118 million for K-12 schools;
-- $44 million for early childhood education;
-- $40 million for all-day kindergarten.
• Outlines $5.1 billion in cost savings and reductions over four years through "reform and responsible fiscal management."
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