GOP announces "give it back" tax relief plan after surplus forecast
ST. PAUL, Minn. -- The latest economic outlook shows Minnesota with a considerable budget surplus of $17.5 billion. Minnesota's budget commissioner says it shows a strong economy with lower inflation and a milder recession than previously anticipated.
With that news came a resurgence in debate at the Minnesota State Capitol on how to spend it over the next two years.
On Tuesday, Republicans announced a "Give it Back" tax relief plan. They say the plan would return $13 billion to taxpayers over the next two years. Republican Party members of the House and Senate are presenting four ways to do it.
"That's eliminating Social Security tax, that's permanent ongoing income tax relief, that's property tax relief for Minnesotans, and that's one-time relief for Minnesota in the form of money back to them in a one-time check," Senate Minority Leader Mark Johnson said.
"Across, the board, we are uncompetitive on every measure of taxation," said House Tax Committee member Rep. Kristin Robbins. "So this is a way we can reduce rates on income for families and get that relief to them, and it will be a permanent reduction to help make our state more competitive."
A full elimination of social security tax is something that Gov. Tim Walz has said he does not support, despite agreeing to a deal to do it last year. Some members of his own party have called on him to eliminate social security tax.
Republican lawmakers say those checks would be about $1,250 for single filers, and $2,500 for joint filers. Additionally, parents would see an $1,800 tax credit per child under the age of 18 "without strings attached on its purpose or use."
Democratic Party members, who currently hold the power at the Capitol, say the surplus provides an opportunity to pass priorities with child care, education and health care.
They also vowed "responsible" budgeting.
The state legislature has a summer deadline to craft a two-year budget for 2024 and 2025. Including the surplus, lawmakers will allocate more than $72 billion.