This column originally ran in the Owatonna People’s Press.
Tax relief and reform should be top agenda item in 2018
Tax season is right around the corner, and many of us have already been receiving the documents we will need to file our returns in April. It is also the time of year that many of us start looking at those documents and wondering where our money is going.
Going forward, tax season should be a bit easier to manage. Last session we passed the largest tax relief package in almost two decades, with targeted permanent relief to middle class taxpayers. Our plan will boost wages and jumpstart the economy – especially in Greater Minnesota.
Because the U.S. Congress passed their tax overhaul in December, Minnesota taxpayers are going to see even more benefits… but only if we take advantage of the changes here at the state level.
This is important: the state has to update its tax code regularly to reflect changes at the federal level. This is a process called “tax conformity.” It sounds dull, but it is especially important this year due to the federal overhaul.
There are several major reasons we have to take action:
For one thing, this is a tremendous opportunity to simplify our system. Thanks to the congressional tax bill, filing your federal return will be much easier. This was one of the big benefits of tax reform. Unfortunately, if we do not update our tax code, you will need a professional form H&R Block to navigate the differences in our tax code.
For another thing, our state budget – aside from being too large – is actually at a good level. The discussion about what the state should and should not be funding can be had another day, but right now the state is taking in just enough money to fund our budget. If we do not bring our tax code into line with the federal changes, state government is going to unnecessarily take much more from you than it needs. You should not be forced to shoulder the burden and fork over even more of your money.
Having Republicans in charge of both the state Legislature and the U.S. Congress is great for family budgets. We started a new conversation surrounding taxes last year – instead of asking how much we can get from taxpayers to fund our wish list, we sought to put more money back in your pockets.
The federal bill, like our state tax relief, is designed to stimulate wage growth for working families and revitalize our economy. If we do not pass tax conformity to update our state tax laws to match the federal laws, we will lose out on every benefit the president and Republicans in congress intended with the federal tax bill. Instead, we will lag behind while our neighbors in Wisconsin, the Dakotas, and Iowa watch their economies soar and their citizens reap the benefits.
We need to pass tax conformity this year so Minnesota’s hardworking families see the same savings.