Tax talks underway, but agreement hinges on larger deal

Melissa Hortman, Paul Gazelka, Tim Walz.
Senate Majority Leader Paul Gazelka (center) and Gov. Tim Walz speak to each other at the Minnesota State Capitol as House Speaker Melissa Hortman (left) stands nearby in St. Paul in 2020. The three need to reach a broad agreement on the state budget before tax negotiators and other conference committees can finish their work.
Scott Takushi | Pioneer Press via AP 2020

At the Minnesota Capitol, House and Senate negotiators are meeting on their differences over taxes, but for now, there are limits on how much they can accomplish.

With House Democrats pushing for tax increases and Senate Republicans opposing them, the conference committee cannot reach a tax bill compromise until legislative leaders strike their overall, end-of-session deal. And until leaders decide what to do on taxes there can be no global agreement on spending.

House Tax Chair Paul Marquart, DFL-Dilworth, said that in the meantime, the panel members will work on as much as they can. The conference committee agenda for a Wednesday meeting included discussion of provisions related to public finance, local sales taxes and tax increment financing.

But Marquart said then it’s a waiting game.

Grow the Future of Public Media

MPR News is supported by Members. Gifts from individuals power everything you find here. Make a gift of any amount today to become a Member!

“Will there be revenue raisers? Will there not be revenue raisers?” Marquart asked. “We really do not know that until the governor and the speaker and senate majority leader come to agreement.”

Neither side has budged on their competing tax positions.

Senate Tax Chair Carla Nelson, R-Rochester, said the state’s current budget surplus, healthy reserve accounts and federal relief should be enough.

“We’re awash in money. It’s not about the money,” Nelson said. “So, that should take a lot of pressure off the tax bill, I think, and let us focus on using those resources that we have.”