Minnesota’s future: Make Minnesota business-friendly again
Until we lighten the tax burdens in the state, businesses will continue to leave. 
By: Senator Jordan Rasmusson

Note: This op-ed was originally published in the Star Tribune.

Plenty has been written about the results of the legislative session in Minnesota since May. There’s no denying the bills signed into law will have wide-ranging impact on Minnesotans. One-party control gave us a fast-paced session passing bill after bill, each with big promises for what they would do.

The list included energy mandates, a slew of social policies, new business regulations and the launch of a new state-run paid leave program. It also included more than $9 billion in higher taxes on Minnesotans.

Democrats have been on a victory tour to tout the benefits of the session, and most recently have pointed to a CNBC ranking of states on business competitiveness.

However, the CNBC ranking makes the same mistakes Democrats make when looking at what it truly means to be a business-friendly state. According to CNBC, they use marketing documents put together by state agencies, and among the considerations given the lowest influence for ranking a state was the cost of living and business friendliness.

If it’s not the cost of living and business friendliness, what do they consider more important in making a state competitive? Access to renewable energy, voting rights and abortion rights are all categories that weigh higher in these rankings than regulations and costs for business administration.

Whatever you think of the value of those policies, they are not directly tied to what it means to run a business.

More objective measures, like those from the National Tax Foundation, provide a very different picture. Their stark analysis shows Minnesota has the fifth-highest tax collections per capita and the 39th-worst for the percentage of income Minnesotans pay in state and local taxes. We are the fifth-worst for business tax climate — which includes corporate, individual, sales, unemployment and property taxes.

Bottom line: Minnesota is an expensive place to live and an expensive place to do business. What’s even more startling is these rankings are from 2022 and don’t include the more than $9 billion of higher taxes Democrats passed this last session. These taxes are a burden for Minnesota families of all income levels and make it harder for them to thrive in our economy.

The district I represent borders both North and South Dakota, and we see firsthand what those policies can do to businesses and families. We’ve seen many uproot their families or expand their businesses in the towns across the border. The grass isn’t any greener on the other side of the river, but their bank accounts are. They have more money to put back into their businesses, creating more jobs. Families have more money to spend on their priorities — whether it’s a family vacation, more resources to pay for child care or an easier time saving for college.

Every time another burden is placed on a business, every time another fee is added to a family’s tax bill, it gets more and more enticing to consider a move. There have been several recent headlines of businesses doing exactly that, but if you are only looking at slick marketing packets and ignoring any data that runs counter to your message, you’ll miss the real-world impact of the policies passed.

The reality Democrats ignore is that Minnesota’s economic indicators lag the nation. So far this decade, Minnesota ranks 35th in economic output growth, 40th in job growth, 35th in labor force growth and 42nd in net domestic migration. Instead of addressing Minnesota’s government-imposed barriers to growth, Democrats are making it harder for our economy to grow and celebrating the barriers.

Minnesotans can’t afford a government that takes on so much and tells them it knows best where their money should go. Market-driven growth is historically the best way to help everyone improve their standard of living. Good businesses create high-paying jobs and offer quality benefits and work cultures because that’s how they retain workers.

There is a place for government in our economy, but we reach a point when government is making things harder for citizens instead of making it easier. Republicans stand ready to have the kinds of debates that will give our state better policy, but if Democrats continue their approach that disregards information they don’t want to hear, we will continue to see families and businesses move to other states.