Give the money back to the people!
The Associated Press headline on March 31 was stark and jarring: “Key inflation gauge sets 40-year high as gas and food soar.”
But it wasn’t the first of its kind. On March 10, the AP wrote: “US inflation soared 7.9% in past year, a fresh 40-year high.”
Record inflation is increasing costs on virtually every good and service people consume, resulting in exceptionally difficult times for many Minnesotans. While family budgets are getting squeezed, the state government is flush with cash.
In 2021, the legislature passed a bipartisan, $51 billion two-year budget. Less than a year later, the state has a massive budget surplus of over $9 billion. This surplus simply means the state government is over-collecting from the taxpayers.
Senate Republicans are proposing to give the money back to the people with permanent, ongoing tax relief. Early in session, we proposed the largest tax cut in state history. On April 7, we passed it off the Senate floor with bipartisan support.
Our proposal would completely eliminate the tax on Social Security income, and we reduce the 1st tier income tax rate from 5.35% to 2.8%.
Eliminating the tax on Social Security income is one of the issues I hear about most in conversations with folks around the district. According to AARP, Minnesota is 1 of only 12 states that still taxes Social Security. The time is long overdue to eliminate this burdensome tax on seniors.
When it comes to income taxes, Minnesota is one of the highest-taxed states in the country. To put this into perspective, Minnesota’s lowest tax rate of 5.35% is higher than the highest tax rate in 24 other states.
Our tax cut proposal will help all taxpayers – if you work and pay taxes, you will have more money in your pocket every single paycheck, week after week, month after month, year after year. It would save most middle-class individual filers over $500 annually and most middle-class joint filers over $1,000 annually.
Permanent, ongoing tax relief is the best way to return the surplus back to the people because it addresses the structural surplus and overcollection of money from taxpayers.
You may also have heard about Governor Walz’s plan to send one-time checks to some Minnesotans.
While I fully support putting more money in the pockets of Minnesotans, this is not the best approach. The governor’s plan is only one-time, it would be subject to federal taxes, and it does nothing to address the issue of Minnesotans being overtaxed. Under Governor Walz’s plan, tax rates will remain high, surpluses will continue to grow, and Minnesotans will continue to send too much money to the state.
Inflation is eating away at family budgets while the state has a huge budget surplus. Republicans are committed to putting more money in the pockets of working Minnesotans and senior citizens with permanent, ongoing tax relief.
But we can’t do it alone. We need Democrats in the Minnesota House of Representatives and Governor Walz to join our efforts.