The 2022 legislative session is set to adjourn in less than two weeks… here is a look at this past week. 

Senate Passes Tax Relief to Help with Rising Costs & Burdensome Taxes  
Fresh off passing the largest tax cut in state history last month, Minnesota Senate Republicans approved a second round of historic tax relief for working families, retirees, and small businesses. The bill passed with broad bipartisan support on a vote of 42-22. 
  
The bill includes the top two tax priorities for Senate Republicans this year—a full exemption of the Social Security benefits from state taxes and a significant reduction of the lowest income tax rate… and builds on the previous historic tax bill with additional relief aimed at helping working families afford daily life under the pressure of out-of-control inflation.  
 
“The state’s budget surplus means one thing—government is collecting too much money from the taxpayers. The State government is flush with cash while record-high inflation is squeezing family budgets. We are passing permanent, ongoing tax relief so Minnesotans will have more money in their pockets every single paycheck—month after month & year after year.” 

Senate Republicans’ two tax priorities are the marquee items in the second tax bill: 

• Reducing the first-tier tax rate: The bill reduces the first-tier tax rate for all filers from 5.35% to 2.80%. 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 annual savings of $759. A typical family making $100,000 would see a savings of $1,064 every year. 
    
• Full elimination of the tax on Social Security income: Minnesota is one of just 13 states that tax Social Security benefits. Impacting taxpayers starting at $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 every year. 

Tax Relief for Families

• With inflation spiraling out of control and the cost of necessities becoming more and more unaffordable, the Senate’s second tax cut bill provides badly needed relief for working families.
• Supports families with kids in grade school by providing relief on K-12 expenses via the state’s K-12 Subtraction and K-12 Tax Credit 
• Allows 529 College Savings Plans to be used for K-12 tuition 
• Enhances the Child and Dependent Care Credit for families who need childcare
• Establishes a tax credit for small businesses that offer paid family leave
• Provides relief on energy bills by exempting polar vortex-related natural gas charges
• Provides relief for affordable and rental housing by reducing the tax rate on low-income rental property and creating a new Affordable Housing Market Value Exclusion
• Provides property tax relief by expanding the homeowner Property Tax Refund and increasing the Homestead Market Value Exclusion 

SUPPORT FOR SMALL BUSINESSES AND ENTREPRENEURS 
The Senate’s second tax cut bill continues Republicans’ support for the small businesses that are the lifeblood of communities across the state by making it easier to operate in Minnesota.

• Encourages investment in groundbreaking, innovative companies by extending the state’s Angel Investor Tax Credit and increasing the tax credit for research and development 
• Eliminates the sunset of the Historic Structure Tax Credit, the hugely successful job-creating tax credit that helps rehabilitate historic buildings. A study found that every $1 spent on the tax credit generates $11 in private sector economic activity 
• Provides property tax relief for job creators by reducing the statewide general property tax and beginning the process of eliminating it completely 

OTHER PROVISIONS

• Encourages retention of law enforcement personnel by establishing a tax credit for public safety pensions 
• Creates a tax credit for “preceptors.” These are advance practice registered nurses, physicians assistants, or mental health professionals who served as student preceptors in their profession but did not receive compensation for their services 
• Provides charitable gaming tax relief 
• Supports farmers with a new agricultural buffer credit for agricultural and rural vacant land that is subject to the state’s buffer law 
• Incentivizes community development and economic growth in distressed communities by creating a tax credit for new markets 

Ruud receives 2022 Minnesota Public Television Good Neighbor Award
Senator Carrie Ruud was recognized as the recipient for the prestigious Good Neighbor Award presented by the Minnesota Public Television Association President Patty Mester.

“I am honored to receive this award, and I want to thank Minnesota Public Television for being part of my neighborhood. Minnesota Public Television is a large part of what makes our state amazing. Every night MPR gives us the opportunity to hear the local news and a chance to learn about what’s happening in our communities. The projects created by public television allow Minnesotans the opportunity to learn about new and unique topics that touch hearts and minds.”

Minnesota Citizens for the Arts
Last week I joined a group of bipartisan legislators to champion legislation that funds the Cultural Community Rescue Grant Program. Proposed legislation would provide a one-time appropriation to help arts and cultural groups recover from the lasting effects of Covid.

As a result of Covid, Minnesota arts and cultural organizations lost a total of $2.2 billion in revenue, which led to over 60,000 layoffs in the industry. This bill would use American Rescue Plan Act (ARPA) dollars to fund grants to the roughly 1,400 statewide nonprofits and cultural organizations that were adversely affected by the pandemic.

“The Minnesota Citizens for the Arts held a rally at the Capitol last week to highlight the importance of arts in Minnesota. The arts play a key role in our economy and bring communities together, and unfortunately the industry lost a total of $2.2 billion in revenue over the last two years. As Session winds down, we can’t forget about the arts!”

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Thank you for taking the time to read my legislative update. If you’re looking to hear more from the Capitol, please like me on Facebook.

Have a great start to your weekend!

As always please feel free to contact my office with any questions you might have. My office can be reached by phone at (651) 296-4913 or at sen.carrie.ruud@senate.mn.

Talk to you soon!