More money for millionaires?
Will Minnesota give even bigger bucks to billionaires? More money to millionaires? With Trump in the White House and a Republican rubber stamp Congress, Minnesota’s governor matters more than ever.
The Minnesota Department of Revenue just released its first analysis of what the Republican Federal tax changes could mean for Minnesota. Although some taxes will go down, these changes increase Minnesota’s tax revenue by $2.34 billion over the next four years.
Federal taxable income is the starting point for determining Minnesota taxable income, so our systems are closely linked. Every time Congress changes Federal tax law our legislature must decide whether to change Minnesota’s tax laws in a similar way. Legislators of both parties usually support this because it simplifies filing tax returns for Minnesotans. However, it also allows Congress to determine a lot of Minnesota’s tax policy and often loses revenue for the state.
Republican legislators in Minnesota will want to conform to any new changes that reduce taxes while stopping the Minnesota tax increases the Republican Congress and President put in place. The Republican desire to stop these “automatic” tax increases will give the governor leverage. I hope he will use it well.
Whatever tax code changes the Republicans pass, Governor Dayton must insist that any new Minnesota tax benefits—or the money generated by the increases—go to help ordinary Minnesotans who are struggling in this economy. Corporations and the wealthy get a windfall in the Trump tax plan. They don’t need another one here.