Wintry mix spreads across Minnesota

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Democrats in the Minnesota House are proposing to raise taxes on Minnesota's wealthiest residents, on cigarettes and on alcohol. House DFL leaders released some of the details of their tax bill today.

It would create a new income tax rate for couples with a taxable income of $400,000 per year or more, and a temporary income tax surcharge on couples earning $500,000 or more per year. The plan would raise cigarette taxes by $1.60 a pack and raises alcohol taxes by roughly 84 cents per 12 pack of beer.

House DFL leaders say the tax hikes are needed to fix the budget over the long-term.

"After a decade of deficits that have largely been balanced on the backs of middle-class Minnesotans, we need a new direction as badly as we need a change in the weather," House Majority Leader Erin Murphy, DFL-St. Paul, said. "That is what we're offering today."

The plan would also provide property tax relief for homeowners, increase a tax credit for renters, and provide some tax breaks for businesses.

House Speaker Paul Thissen, DFL-Minneapolis, said the cigarette and alcohol tax increases would offset state costs for damages caused by their use.

"There is overwhelming evidence that tobacco and alcohol consumption cost the state economy billions of dollars every year," Thissen said. "These user tax increases will allow our state to cover some of those costs."

Thissen said the temporary income tax surcharge would end in two years after a shift in the K-12 school payments is paid back. Gov. Dayton has said he opposes a temporary income tax increase and increasing alcohol taxes.

Republicans were quick to criticize the plan.

Republican Representative Greg Davids of Preston was quick to criticize the DFL plan.

"This proposal is a new chapter in DFL reality TV called 'Taxes gone wild" Rep. Greg Davids, R-Preston, said. "That's what we have here. If this is a balanced approach, I would hate to see an unbalanced approach."

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House speaker says cigarette and alcohol tax increases would offset costs to the state

VIDEO: House DFL targets top earners, alcohol and tobacco in tax bill

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