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Concerns raised on Dayton tax plan

Gov. Mark Dayton meets with Minnesota Farmers Union and FFA members Tuesday and promises to do whatever he can to help agriculture. Don Davis | Forum News Service
News Bemidji,Minnesota 56619
Bemidji Pioneer
Concerns raised on Dayton tax plan
Bemidji Minnesota P.O. Box 455 56619

ST. PAUL – Republicans are ramping up their complaints about Democratic Gov. Mark Dayton’s tax plan.

During legislative meetings Tuesday, they especially questioned the Dayton proposal to send a $500 property tax refund to most homeowners.

“We can guarantee people a tax increase, but can’t guarantee them tax relief,” Sen. Dave Thompson, R-Lakeville, told Revenue Commissioner Myron Frans.

Dayton’s plan would raise taxes on the richest 2 percent of Minnesotans and add the sales tax to services and some goods now not taxed, while lowering the overall sales tax rate.

“We are raising taxes at the state level in a big way...” Thompson said. “The tradeoff is the $500 check going back to property owners.”

Sen. Julianne Ortman, R-Chanhassen, said the Dayton plan looks like a “re-election ploy.”

“I cannot figure out why we would take money out of the pockets of middle income and poor Minnesotans just to give it to write a check to homeowners,” she said.

Frans said that during a tour of the state in recent months, Minnesotans told him they were most concerned about rising property taxes. The $500 tax refund was the best Dayton could do now, he added, because there is not enough money available to institute a full property tax overhaul.

Unions fight lockouts

Provisions making it less attractive for companies to lock out workers during labor disputes is high on the Minnesota AFL-CIO legislative agenda.

The labor organization announced its agenda Tuesday, including what it calls the “Employer Lockout Accountability Act.”

The proposal would require unemployment benefits be provided to workers for a lockout’s duration. The AFL-CIO plan also would add a penalty to an employer’s unemployment tax bill if it locks out employees.

Also on its agenda is increasing the state minimum wage. The wage increase would be followed by automatic increases in the future pegged to inflation.

“In November, Minnesotans elected new majorities to the Minnesota House and Senate who care about and will be strong advocates for middle class families,” Minnesota AFL-CIO President Shar Knutson said, adding that the group’s proposal would help the middle class.

How big an increase?

The Dayton administration and fellow Democrats use the figure of $2 billion when discussing tax increases in the governor’s proposed budget.

Republicans say it is far more.

The latest figures from the administration indicate that new taxes would raise $3.6 billion in the next two years. Republicans say that grows to $3.7 billion after fee increases and a proposed Twin Cities transportation tax are added.

When $1.5 billion is sent to homeowners in property tax refunds, that leaves a $2.2 billion net tax increase.

Dayton, farmers meet

Dayton promised a group of Farmers’ Union members Tuesday that he would do whatever he could do to help agriculture.

Several members of the DFL-leaning farm group praised Dayton for starting to reduce property taxes. Dayton’s budget proposal calls for a $500 property tax refund for most Minnesota homeowners, but he did not offer a plan to reform property taxes.

A Yellow Medicine County farmer told Dayton his farmland taxes rose from $12 to $38 an acre in the last decade.

Dayton called the property tax the most unfair of all taxes.

“If you want to get out of the hole, you have to stop digging,” a farmer told Dayton.

Obama coming Monday

The White House says President Barack Obama will visit the Twin Cities Monday, but did not say why he will be in town or provide any other specifics.

One potential topic for Obama is gun control, which he is promoting in light of recent mass shootings, including one in west Minneapolis.

While members of Congress are discussing the issue, so are Minnesota legislators. Bills on tap for state committee hearings are as varied as those to make it tougher for the mentally ill to get guns to another that would allow teachers to carry weapons.

Don Davis
Don Davis has been the Forum Communications Minnesota Capitol Bureau chief since 2001, covering state government and politics for two dozen newspapers in the state. Don also blogs at Capital Chatter on Areavoices.