House and Senate Republicans came together on Tuesday to roll out their tax package to give immediate and lasting relief to Minnesotans.  The “Give It Back” tax plan provides $13 billion over two years in permanent tax cuts and one-time rebates.  

“Given the state’s massive $19 billion surplus, we have an excellent opportunity to provide relief to families and businesses in the state who are still feeling squeezed by high inflation,” Senator Mark Koran (R-North Branch) said. “This is the number one thing I hear around the district: people want us to give the surplus back. We agree.”

The tax package includes tax changes for immediate tax relief today with one-time rebate checks using $5 billion of the state’s surplus funds and $3.5 billion for a one-time child tax credit available for two years. The checks are estimated to be $1250 for single filers, and $2500 for joint filers. The $1800 tax credit per child under the age of 18 comes without strings attached to its purpose or use. 

Permanent relief comes in the form of the elimination of the tax on Social Security for a cost of $1.26 billion to provide 472,902 Minnesotans with an average tax reduction of $1,277 dollars. The list of states that tax Social Security income shrank to just 11 in 2023. The Social Security tax impacts those with just $25,000 in federal income—a far reach from the claim full elimination would only help the wealthy.  

An additional $3 billion in permanent tax relief comes in reducing both the first and second tier tax rates by 1% each to 4.35% and 5.8% respectively. Minnesota’s lowest tax rate is higher than the highest tax bracket in 24 states and is consistently ranked one of the highest-taxed states in the country. Anyone who pays income taxes would see a reduction in their taxes under this plan. It’s a stark contrast to the Democrats’ proposals to tax working Minnesotans in order to pay for a costly and bureaucratic paid leave plan.  Finally, an adjustment of the homestead market value exclusion would give $35 million a year in relief. Rising property evaluations and a tight housing market mean people need relief wherever they can get it. For many, their home is their single largest asset, and this change will allow them to keep more of their home’s value in their bank account each year.