Senator Johnson keeps promise to deliver permanent tax relief to Minnesotans

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 today 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.

The Senate 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.

“It is clear with an over nine-billion-dollar budget surplus that Minnesotans are overtaxed,” Senator Mark Johnson (R-East Grand Forks) said. “This bill honors our commitment to return the surplus back to the Minnesota taxpayers who created it. Eliminating the unfair double tax on Social Security and reducing income taxes have both been long-time goals of mine. It is time we make Minnesota more competitive with our neighbors in North Dakota and around the country.”  

  • 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 was passed on the Senate floor Thursday. The bill now awaits action by the Democrat-led House of Representatives who have their own smaller tax proposal.