The tax chair in the Minnesota Senate is proposing that tax reductions be triggered automatically when there are budget surpluses.
Sen. Roger Chamberlain, R-Lino lakes, presented his bill Wednesday to the Senate tax committee.
Under the measure, the state revenue commissioner would be required to reduce the income tax rate and corporate tax rate by one-tenth of 1 percent if the November economic forecast projects an adequate surplus.
Chamberlain said 11 states have similar tax triggers in place.
“I think it’s a reasonable, rational, conservative way to go about this, and it’s good for the state,” Chamberlain said.
Business groups like the proposal. Representatives of the Minnesota Chamber of Commerce and the Minnesota Business Partnership spoke in support of the bill.
But Paul Cumings, tax policy manager at the Minnesota Department of Revenue, warned the trigger could put future budgets in jeopardy. He also said it would take decision-making power away from legislators.
“Legislators may want to prioritize making sure students will have the resources they need rather than a small reduction in tax rates,” Cumings said.
After the hearing, Chamberlain said the proposal will be included in the larger Senate tax bill that he plans to roll out on Monday or Tuesday.
Chamberlain declined to offer other details about the bill or how it compares to the House tax proposal.
“We have a few things in there that will be different, but not as much as I think I would desire or that the people need,” he said.
Your support matters.
You make MPR News possible. Individual donations are behind the clarity in coverage from our reporters across the state, stories that connect us, and conversations that provide perspectives. Help ensure MPR remains a resource that brings Minnesotans together.