Minnesota Senate Republicans once again delivered on a top priority by sending Gov. Mark Dayton the first significant, sweeping tax relief plan (HF 4) in years. The $1.15 billion tax relief proposal helps nearly every Minnesota taxpayer, and strengthens the state’s workforce in the face of a forthcoming demographic shift that will dramatically reshape Minnesota’s economy.

“For years, this state has had a steadily rising flow of money into its coffers, but we’ve been using it for stadiums and handouts to special interests, while middle income folks have been left behind,” said Senate Tax Committee Chairman Roger Chamberlain (R-Lino Lakes), the bill’s author. “It’s time we start paying attention to the workers of this state, and give them some respect – the farmers, the manufacturers, the laborers, the Main Street business owners, and every working family. This bill will make it easier to save for college, retirement, car repairs, or even that family vacation they’ve been dreaming about”

The bill proposes a number of tax reductions:

• $1.15 billion in immediate tax relief over the next two years
• Social Security income tax reductions, so retirees can keep more of their hard-earned money
• New School Building Bonds Agricultural Credit that prevents farmers from paying undue amounts for school facilities levies
• Full conformity to the federal estate tax, so families can pass down more of their money and property to the next generation
• Child and dependent care credit increases, so families can save more on the high costs of child care
• A new Student Loan Debt Credit, so people with high student loans can save on their tax returns
• An expanded K-12 credit to assist more families with kids in grade school
• A reduction of statewide property taxes, so small businesses have more money to invest in growth and hiring more workers
• Full Section 179 conformity for Main Street businesses which encourages growth and expansion
• Creates a Beginning Farmer Tax Credit to help recruit the next generation of Ag leaders
• New Credit for college savings plans, so it’s easier to save for college

“Read the state demographer’s reports and the analysis is clear: Minnesota will be facing serious challenges in the next few years,” added Chamberlain. “As baby boomers retire in large numbers, our pension programs will be stressed even more, our workforce will shrink substantially, and we will need to provide even more public health resources. The only way we’re going to prepare ourselves is to encourage stronger economic growth through significant tax relief and reform.”

One notable provision in the Republican tax relief plan is an Opportunity Scholarship program that helps low-and-middle-income students attend the school that best meets their needs. The scholarships, which would be funded using tax-deductible private contributions, would be administered by non-profit organizations approved by the Department of Revenue. ‘Opportunity Scholarships’ would use private money, so public school funding would not be affected.

“Continuing the status quo of persistent achievement gaps and leaving students behind is not acceptable,” said Sen. Chamberlain. “It shouldn’t matter how much money a family has or what community they live in – all students should have the choice to attend a school that meet their needs. The ‘Opportunity Scholarships’ bill offers every student the chance to succeed.”