Senate Democrats on Tuesday passed a tax bill that raises taxes by $1.2 billion through a new controversial worldwide tax, 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.

“Minnesota had a historic surplus, yet Senate Democrats still managed to raise taxes through another piece of legislation,” said Senator Eric Pratt (R-Prior Lake). “Democrats announced nearly a 40 percent spending increase for this biennium and forgot it was overtaxed, hard-working Minnesotans that created the surplus in the first place. Senate Republicans have remained committed to meaningful tax relief for Minnesota families, and though this bill provides some short-term relief for some, it fails to deliver permanent relief for all. Most notably, it fails to include the full elimination of the tax on social security, an issue Republicans have been advocating for all year, and something our seniors will be incredibly disappointed in. With a $17.5 billion surplus, this bill could have provided much more for families and small businesses than it did.”

The bill includes a controversial tax known as “worldwide” or “global” reporting. This risky move will affect businesses based inside and outside of the state, and will likely force many of them to reconsider how much they are willing to invest to do business in Minnesota. Though some states employ an optional version of worldwide reporting, Minnesota would be the first state to implement this broad mandate.

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