The Minnesota Senate today approved a bipartisan $944 million tax bill aimed at jumpstarting the economy and helping workers and small business owners recover from COVID-19. The bill does not include any of the significant tax hikes proposed by Gov. Walz or Democrats in the House of Representatives, both of whom proposed raising taxes by over $1 billion, including the creation of a fifth-tier income tax.

“The Senate kept our session long promise of no new taxes in this year’s budget,” Senator Bill Weber (R-Luverne), Chair of the Subcommittee on Property Taxes, said. “Since the onset of session, our goal has is to lower taxes on Minnesotans and provide relief that encourages growth in our economy, brings back jobs, and makes Minnesota more affordable. Through nearly a billion dollars in relief, we’re helping small businesses expand and survive COVID-19, we’re helping families by increasing childcare options, and working we’re working to increase access to affordable and workforce housing.”

The bill empowers Minnesotans and encourages economic growth with two top priorities for workers championed by Senate Republicans all year: full conformity to federal tax rules for the forgivable Paycheck Protection Program loans many businesses used to survive the COVID-19 pandemic, including deductions for expenses, and full conformity for federal pandemic unemployment benefits up to $10,200. Conforming to these federal rules lowers taxes for those affected so they aren’t taxed on money sent by the federal government to help them get by during the pandemic.

This tax bill includes several provisions to help the state’s job creators and businesses invest and grow. Main street businesses will see lower property taxes as a result of this bill through the lowering of the statewide property tax levy, and we end a budgeting gimmick that forces businesses to pay sales tax payments for the month of July in June. These provisions will help businesses increase capital to reinvest in their companies and employees.

  Other highlights of the bill:

• This establishes the Frontline Workers Grant program working group to make recommendations on the disbursement of $250 million as a direct cash benefit to frontline workers. COVID relief funds from the federal government can be used to benefit those workers who were put at risk as they continued to work during the pandemic. The working group will be tasked with defining eligible workers and the matching benefit, which the full legislature will then adopt.
• Financial support for the Oriented Strand Board (OSB) project in Northern Minnesota to bring hundreds of direct and indirect jobs to the community. The OSB was recently approved to receive $15 million in funding from the Iron Range Resources and RehabilitationBoard.
• The bill extends the Angel Tax Credit by $5 million, which encourages investments in startup companies focused on high technology, new proprietary technology, and other groundbreaking fields. 
• The bill extends the Historic Structure Rehabilitation 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 $9.50 in private sector economic activity.
• The bill emphasizes affordable housing and workforce housing with a new tax credit to bring private money into the marketplace. 
• The bill raises the exemption from $100 thousand to 150 thousand for the state general property tax levy
• The bill provides annual aid payments to counties to address student homelessness.
• The bill eliminates taxation of construction materials for public safety facilities.
• This lowers the Working Family Credit minimum age so more young Minnesotans qualify for this crucial tax relief.