On Tuesday, May 2, Senate Democrats passed a tax bill that fails to deliver meaningful tax relief and does not provide for the full repeal of the social security income tax. The bill includes a $1.2 billion tax increase and a new controversial, business worldwide tax which has not been implemented in any other state. 

“With a $17.5 billion surplus, $19 billion before the accounting change, Minnesotans deserve to see the majority of the surplus back in their pockets,” Senator Gary Dahms (R − Redwood Falls) said. “It’s unbelievable that we do not have enough money to fully eliminate the tax on Social Security income. Unfortunately, that is what the Democrats have chosen to do.” 

During last year’s election campaigns, a majority of Minnesota Senators promised to prioritize the full elimination of the state tax on Social Security as 39 other states already do. This bill fails to deliver on that promise.

 “There are several good things in this tax bill including agreed to provisions from last year’s tax bill by the Senate Republican majority,” continued Senator Dahms. “However, I voted against this tax bill because with a historic budget surplus, there is absolutely no reason for a $1.2 billion tax increase and no reason why we can’t eliminate state income tax for all Social Security recipients.” 

During the Senate floor debate, Republicans offered several amendments which were either struck down or ruled out of order by the Democrat majority. Among them: 

• Creating a permanent and automatic refund program to ensure taxpayers are first in line when there is a government surplus. 
• Deleting the mandatory worldwide reporting tax. 
• Using a surplus trigger to eliminate the June accelerated payment for excise taxes. 
• Eliminating the childcare tax credit 2030 expiration date. 

The Omnibus Tax bill passed on a party line vote and is now in a conference committee where differences will be worked out with the House.

 Click here to hear more of Senator Dahms’ comments.