With inflation at 40-year highs and working Minnesotans being squeezed more every day by soaring prices for gas, groceries, and energy, today we made good on an early session promise to give back Minnesota’s historic $9 billion budget surplus with the largest permanent tax cut in state history.

Our caucus passed a landmark tax bill that reduces the first-tier tax rate for all filers from 5.35% to 2.80% and includes a provision to eliminate the state income tax on all Social Security benefits. The bill provides taxpayers with a much-needed $8.43 billion in relief over the next three years.

Minnesota got this record surplus due to the hard work of Minnesotans. Yet as the government’s bottom line got bigger, Minnesota families and seniors have been hurting trying to make ends meet while also fighting record-setting inflation. Why should the government have more when you have less? That simply isn’t right. As one of the most overtaxed states in the nation, we need to fix our tax climate and do something to help our residents. We need to do more than one time check, and we can do that now by providing permanent and substantial tax relief.

• Reducing the first-tier tax rate: 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.

I have repeatedly heard from constituents over the last few months to give the money back to those who have overpaid. This bill does just that.