Over 1.1 billion dollars in tax relief is the centerpiece of Republicans’ proposed state budget, which would likely lower taxes on Social Security benefits, small businesses and farm property. Senate Majority Leader Paul Gazelka says, “We’re gonna fight for it. We think it’s a good tax bill. We hope that the governor can be convinced of that.” House Democratic Minority Leader Melissa Hortman responds Republicans’ plan is “extremely irresponsible. It would lead to a decade of deficits.” Hortman says there could be a “really impressive” tax cut bill in the dollar range of legislation that didn’t quite become law last year.
Republicans’ continued push to lower state taxes on Social Security income will likely be another sticking point, because Democrats warn its high cost could endanger the stability of Minnesota’s state budget. House Speaker Kurt Daudt takes a different view saying, “We’re only of only seven states that taxes Social Security income. We believe that seniors shouldn’t be taxed on that income.”
Republicans will also have a tough sell to Governor Dayton on their state budget proposal that includes half-a-billion dollars in cuts to state agency budgets. Dayton earlier warned lawmakers against making across-the-board reductions. Saint Cloud Republican Jim Knoblach responds the process requires them to have specifics for each department and “you will see where we think we can save money and where we think we can’t.”