Minnesota Legislature: House goes for property tax breaks
A bill representatives passed 125-0 Friday adds to $443 million in tax cuts already approved.
The new bill is “heavily focused on property tax cuts for farmers, homeowners and renters,” said House Tax Chairwoman Ann Lenczewski, D-Bloomington.
About $45 million of the tax relief is designated to trim property taxes.
Like a Thursday debate on new spending, much of the Friday tax discussion centered on rural issues.
The tax bill would send $18 million to 90,000 farmers who homestead the property. The average family farmer would receive $460.
Among other tax cuts in the new bill:
• $12.1 million would go to one-time homeowner property tax refunds for 500,000 homeowners, a 3 percent increase.
• A 5 percent increase is provided for renter refunds for 350,000 Minnesotans.
• $7.2 million in the next year would be available for income tax deductions for homeowners who go through foreclosures or short sales.
• All local governments would be exempted from paying sales taxes.
• $3 million would be available for the next year to extend National Guard members’ income tax break.
• $40.1 million would be saved by businesses by eliminating a law that requires them to pay June sales tax two months earlier than other payments are due.
• Businesses with less than $150,000 market value would be exempted from a statewide business property tax.
• $15 million a year would go to investors in greater Minnesota, minority- and women-owned companies.
• $1.5 million in tax credits would be extended to cities that compete with lower-tax North Dakota (Breckenridge, Dilworth, East Grand Forks, Moorhead and Ortonville).
• $740,000 would be paid to 11 rural counties that did not receive the planned County Program Aid increase lawmakers passed last year.
• Duluth would be allowed to add food, beverage and lodging taxes up to 0.5 percent.
• Brainerd and Baxter could extend local sales taxes so they may jointly fund a sewer project.
Democrats patted themselves on the back for actions last year that lowered property taxes.
“This year for the first time in 12 years Minnesotans actually will pay less in property taxes,” said Rep. Jim Davnie, D-Minneapolis, adding that the new bill will help taxpayers more.
Representatives rushed the second tax bill to a vote before they leave on a 10-day Easter-Passover break after they finish work Thursday.
“We are really hurrying to get tax relief to folks,” Lenczewski said.
As part of the pre-recess rush, the House late Thursday approved 70-59 a bill adding $322 million to the current $39 billion, two-year budget.
While the House debated tax cuts Friday, the Senate Finance Committee rushed to meet its deadline to pass its budget bill. That budget bill could be in front of the full Senate on Tuesday.
The Senate has yet to finish its second tax bill, but it could be ready before the holiday break.