Tax Omnibus Bill Raises Taxes, Fails to Deliver Meaningful Relief

Senate Democrats on Tuesday passed a controversial tax bill that raises taxes by $1.2 billion from foreign sources through controversial worldwide reporting, which has not been implemented in any other state. The bill fails to deliver meaningful tax relief, and fails to provide the full repeal on the social security income tax.

“There is no reality in which a historic $17.5 billion surplus should lead to $1.2 billion in tax increases, yet Democrats found a way to do just that with this tax bill,” said Senator Jeff Howe (R-Rockville). “This bill completely misses the mark. Republicans have spent countless hours offering amendments and ideas that would have offered tax relief and made this bill better, but Democrats had little interest in what we put forward. It’s incredibly disappointing that the full repeal of social security was also left out of this bill. On multiple occasions this session, Senate Republicans brought forward a clean bill that funds the elimination of this outdated tax, because it’s what our seniors have been asking for. Instead of acting on that, Democrats tried to use our seniors’ needs as a gimmick to add an additional tax increase. This bill is a disappointment in every way.”

The bill includes a controversial tax known as “worldwide” or “global” reporting. This means that any businesses with a presence in Minnesota will be forced to report all income, even that from outside Minnesota in a way that no other state in the country or the world requires. This risky move will affect businesses based inside and outside of the state, and will likely force them to reconsider how much they are willing to invest to do business in Minnesota. 

Senate Republicans attempted to offer a number of amendments, which were either struck down or ruled out of order:

  • Creation of a permanent and automatic refund program to ensure taxpayers are first in line to benefit from future government surpluses
  • Requirement of a supermajority vote to raise income taxes
  • Elimination of the child care tax credit 2030 expiration date