Senator Mathews: Senate Republicans keep promise to deliver permanent tax relief to every Minnesotan

ST. PAUL, MN – With inflation at 40-year highs and working Minnesotans being squeezed more every day by soaring prices for gas, groceries, and energy, Minnesota Senate Republicans made good on an early session promise to give back Minnesota’s historic $9 billion budget surplus with the largest permanent tax cut in state history, said Senator Andrew Mathews (R-Princeton).

The Senate Tax Committee today approved a landmark tax bill that reduces the first-tier tax rate for all filers from 5.35% to 2.80%, and fully eliminates the state income tax on all Social Security benefits. The bill provides taxpayers with a much-needed $8.43 billion in relief over the next three years.

“Our $9 billion budget surplus is a clear indicator of just how severely overtaxed Minnesotans are,” Mathews said. “In light of historic inflation rates, energy prices, and the cost at the gas pump, families’ budgets are being hit hard and they need relief now. It is high time to give this money back to hardworking Minnesotans in the form of immediate and permanent tax relief.”

  • Reducing the first-tier tax rate: Minnesota’s lowest tax bracket is higher than the highest tax bracket in 24 other states. Over 2.4 million filers would benefit from the historic Republican tax rate cut, with an average savings of $759. A typical family making $100,000 would see a savings of $1,064.
  • Full elimination of the tax on Social Security income: Minnesota is one of just 13 states that tax Social Security benefits. Impacting taxpayers with just $25,000 in income, the Social Security Income tax hits more than 407,000 Minnesota filers. None of the states that border us — Iowa, Wisconsin, Michigan, and South Dakota — tax Social Security income. Eliminating the Social Security tax would put $1.6 billion back into the hands of beneficiaries, with an average benefit of $1,254.

In the last five years, Republicans passed billions in tax cuts, stopped Gov. Walz’s massive tax increases, and passed the first income rate tax cuts in 20 years. Senate Republicans will continue the fight for meaningful and permanent tax relief.

The bill is expected to be heard on the Senate floor on Thursday, April 7.