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Minnesota Budget
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Minnesota Taxes
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Federal Tax & Budget
Economic Self-Sufficiency
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Minnesota Budget Bites
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ABOUT USThe Minnesota Budget Project is an initiative of the Minnesota Council of Nonprofits.
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Minnesota's Tax Rankings Hover Near Average, May 21, 2008 This joint press release by the Minnesota Budget Project and Growth & Justice highlights U.S. Census figures released last week which show Minnesota is 19th in the nation in total state and local taxes, measured as a percentage of income for Fiscal Year 2006. This is down considerably from 5th place in Fiscal Year 1995. Meanwhile, our state is falling behind in investments that are important for the state’s economic future. In 2006, Minnesota ranked 21st in the nation in state and local total education spending and 36th in state and local highway spending. Tax Fairness Declining in Minnesota, April 2007 This issue brief describes Minnesota's state and local tax system. It describes how over time the state's tax system has become less fair. It also finds that taxes, measured as a share of income, have been rising since 2002, although they are still lower than in the 1990s. Earlier versions of this issue brief were published in 2005, 2003, 2002, and 1999.
Minnesota's Income Taxes Among Most Fair to Working
Families, February 2006
Minnesota has been one of the nation's leaders in ensuring that the state's income tax does not push struggling families into poverty. Minnesota's poor families, minimum wage earners, and working poor families pay among the lowest income taxes in the country. But Minnesota still has work to do to maintain a fair tax system, according to this series of fact sheets. The Advocate's Fiscal Toolbox, Updated June 2007, HTML
or PDF This web page includes links to primary tools in understanding state tax and budget system, including the Department of Revenue's Tax Incidence Study, the Governor's Budget, and legislative fiscal notes. What is the Renters' Credit/Circuit Breaker
Property Tax Refund?, Updated March 2008 The first fact sheet describes Minnesota's Property Tax Refund (PTR), which is a state tax credit received by one in five Minnesota households. The PTR is commonly called the Circuit Breaker when it applies to homeowners and the Renters’ Credit when it applies to renters. The second fact sheet describes the number of Minnesotans who receive the Renters' Credit, the average amount of credit, and the significant share of recipients who are seniors or disabled persons. This information is also provided for each county, as well for the state as a whole. Some of this data has been made into maps by Minnesota 2020. "High Tax" State is Only Average, December 2004, HTML or
PDF This opinion piece takes a closer look at tax rankings, and finds that when looking at a more comprehensive measure of the size of government, Minnesota ranks in the middle of the 50 states. Minnesota's Tax Rankings: How Do We Measure Up? Updated May 2003, HTML
or PDF Minnesota is often described as a high tax state, with tax rankings mentioned as proof. However, if we look closer at how Minnesota compares to other states, we find the picture is more complex. Also available is a previous version from November 1999. Research Review: Impact of Tax Cuts Described and Minnesota's Tax Gap
Measured, January 2003, Minnesota Budget Bites The January 2003 Minnesota Budget Bites reviews two reports discussing Minnesota's tax system. Impact of Tax Cuts Described provides an overview of the effects of tax cuts from 1997 to 2001, including the total amount of tax cuts, and how the mix of taxes has changed. Minnesota's Tax Gap Measured reports on how much in sales and use taxes go uncollected in Minnesota. Wasted Opportunities: How We Used Our Surpluses 1997-2001, January 2002, HTML
or PDF This joint release with Children's Defense Fund-Minnesota finds that, of the total surplus dollars allocated in 1997 through 2001, more than
half were spent on tax cuts and rebates. Less than one third were
spent on improving or expanding services. Certain funding areas, particularly Health and Human Services and Children
and Families, received almost no surplus dollars for the entire five-year
period. Even though some of the surplus went to increased spending, the portion of
Minnesotans’ incomes going to state and local government has declined, as
measured by the Price of Government. This report is summarized in the
February 2002 issue of Minnesota Budget Bites.
An Introduction to Property Tax Reform in Minnesota, October 1999 Minnesotans are affected by the property tax both as taxpayers and as beneficiaries of the services the property tax funds. This report is designed to help citizens become better informed about property tax reform and to be involved in the reform debate. Contents include:
2008 Legislative SessionSee our analysis of the outcomes of the Legislative Session at our blog, MinnesotaBudgetBites.org. Renters' Credit At Risk resource page This web page contains links to information about the Renters'
Credit and proposals to cut it in the 2005 and 2008 Legislative
Sessions.
2007 Legislative SessionWhat's At Stake: 2007 Revenue Proposals, May 2007 Two critical questions before policymakers in the 2007 Legislative Session are whether to raise additional revenues in order to fund the state's priorities, and whether to address rising inequality in our tax system. This comparison of the House, Senate and Governor's revenue proposals find very different answers to these questions. The House and Senate each propose income tax increases on the wealthiest Minnesotans that would fund property tax reductions for many other Minnesotans. The Governor has stated his belief that the state should work within the resources available, and thus has very modest revenue proposals. Governor's Budget Makes Little Progress on Narrowing Disparities, Improving Budget Process, January 2006 In this press release, the Minnesota Budget Project measures the Governor's Budget proposal, and finds it comes up short in terms of narrowing disparities between those who are well off and those who are struggling, reforming the state's budget process, and improving the state's tax system in terms of fairness and adequacy. 2006 Budget Decisions Leave Much on the Table for 2007, November 2006 This analysis finds that the 2006 Legislature focused on addressing immediate needs, missing the opportunity to offer comprehensive plans for moving the state towards a more positive future. This issue brief provides an overview of the budget decisions made in 2006, and a preview of issues on the agenda for 2007. Letter to Conferees: SF 2734, May 2006 In this letter, the Minnesota Budget Project states its opposition to a floor amendment to SF 2734 that would put a freeze on any new or increased fees or taxes for a period of seven years. In addition to outlining several technical flaws, the letter argues that budget choices should be made in the legislature after an informed and public debate that considers all the implications, not by a formula set in the constitution. Testimony: House Omnibus Tax Bill, May 2006 In testimony before the House Tax Committee, the Minnesota Budget Project argues against the large fiscal impact that the House omnibus tax bill would have in the 2008-09 biennium. The testimony notes that should the bill be enacted into law, the 2007 Legislature would find they did not have enough resources to maintain current services. The committee was provided with copies of Minnesota's Budget Surpluses May Be Short-Lived.
House Omnibus Tax Bill Would Hurt Minnesota Renters,
May 2005 The Renters' Credit is a source of tax fairness and housing assistance for low- and moderate-income Minnesotans. Governor Pawlenty's budget proposal would cut the Renters' Credit by 20% in FY 2007 and 25% in FY 2008 and future years. The House's budget proposal could cut the Renters' Credit by 44% in FY 2007. Renters' Credit At Risk resource page This web page contains links to information about the Renters' Credit and proposals to cut it in the 2005 and 2008 Legislative Sessions. Testimony on House File 1516, March 2005 House File 1516 and Senate File 1333 would partially roll back the income tax cuts made during the surplus years. Testimony by the Minnesota Budget Project describes the impact of cuts made in past budget-balancing plans, and argues that a fairer way to balance the budget is to include raising revenues in a way that takes into account Minnesotans' ability to pay.
What's At Stake in 2004 - Revenues: A Comparison of Legislative Proposals, May 2004, HTML or PDF In the final days of the legislative session, it is still unclear how the state's budget deficit will be resolved. This document outlines how revenues would be used by the House and Senate budget plans to address the deficit, as well as other proposed tax changes. Issues addressed include the Renter's Credit, Racino, Corporate Loopholes, Single Sales Factor, and the AMT.
Minnesota Cannot Afford Proposed Corporate Tax Cut: Legislature Should Reject Single Sales Factor, April 2004,
HTML or PDF This two-page brief argues that the Legislature should not adopt a proposed corporate tax cut. Single Sales Factor, as the policy is called, is not affordable, would hurt more businesses than it benefits, and is not an effective job creation tool.
Testimony before the Senate Tax Committee, April 20, 2004, HTML or PDF
This transcript of Madden's testimony on an early draft of the Senate Omnibus Tax Bill includes a discussion of two proposals
included in the bill - a reduction in the renter's credit and Single Sales Factor.
Revenue-Raising Options to Address Minnesota's
Budget Deficit, Updated May 2003, HTML or PDF
This document presents a range of revenue-raising
options, estimating how much revenue each could raise and weighing them against
our principles for fiscal decisions.
Much of the discussion of tax changes in the 2002 Legislative Session were in the larger context of the larger budget debate. The budget documents described below include discussions of tax proposals. Budget Decisions in the 2002 Legislative Session: State's Budget Balanced
in the Short Term, but Large Deficit Remains for Next Biennium, June 2002, HTML or PDF When the 2002 Legislature convened, they faced projected state revenues for the 2002-03 biennium that were 7.6% lower than predicted at the end of the 2001 session. This meant a $1.953 billion deficit for 2002-03 and a $2.535 billion shortfall for 2004-05. With a deficit of this magnitude, the Legislature faced very difficult choices. This document describes the major budget decisions of the 2002 Legislative session, and measures them against our principles for state fiscal decisions. Testimony before the Budget Reconciliation Conference Committee, April 10,
2002,
HTML or PDF The Budget Reconciliation Conference Committee held several days of public testimony to get input on how the budget should be balanced. The Minnesota Budget Project's testimony calls for no additional budget cuts and closer attention to tax fairness. House and Senate Phase 2 Budget-Balancing Proposals: Comparison and Analysis,
Updated April 10, 2002,
HTML or PDF This document describes the components of the House and Senate plans for addressing the remaining budget deficit and measures them against our principles for fiscal decisions.
Testimony before the Senate Tax Committee, March 2002, HTML or
PDF The Senate Tax Committee took public testimony on their omnibus tax bill. The Minnesota Budget Project testified in support of progressive tax increases to address the state's budget deficit.
Comparison of Senate Phase 2 Budget-Balancing Proposals, March 2002,
HTML or PDF A side-by-side comparison of the budget plans proposed by the Senate Finance Committee and Senate Republican Caucus to address the state's remaining budget deficit.
Analysis of the House-Senate Budget Agreement, February 2002, HTML or PDF
This issue brief describes the components of the House-Senate Phase 1 budget agreement and measures it against our principles for fiscal decisions.
Comparison of Budget-Balancing Proposals, February 2002, HTML or PDF
This publication provides a side-by-side analysis of how the 2002-03 general fund deficit is addressed by the Governor, House, Senate, and the House-Senate Budget Agreement. Options to Address Minnesota's Budget Deficit, January
2002, HTML
or PDF This document includes information on the state’s budget reserves, outlines several revenue raising options, and provides a framework for thinking about expenditures at the state and local levels. This information can be used to inform and evaluate budget balancing proposals. Principles for State Fiscal Decisions, January
2002 These Principles developed by the Minnesota Budget Project and Minnesota
Council of Nonprofits provides a framework for measuring proposals to address
the state's budget deficit. It calls for use of all three budget-balancing
tools available - use of reserves, raising revenues, and limited expenditure
cuts - and for not making the recession worse for vulnerable Minnesotans.
Tax Decisions in the 2001 Legislative Session, August 2001, HTML
or PDF Perhaps one of the most contentious bills during the 2001 legislative session and subsequent special session was the omnibus tax bill. In the end, significant changes were made to Minnesota’s property tax system and the way certain government services are funded. This summary describes the major decisions made in the areas of property taxes and government financing reform, the sales tax rebate, income and corporate taxes, sales taxes, health care taxes, and taxes on nonprofits. Throughout, provisions with an impact on low- and moderate-income families are emphasized. 2001 Sales Tax Rebate, July 2001 This fact sheet describes the size and eligibility criteria of the 2001 Sales Tax Rebate. 2001 Session Tax Bill Tracking Sheet,
May 2001 This 29-page document describes all tax legislation introduced in the 2001 session, grouped by topic. Proposed 2001 Session Tax Legislation on Low-Income Refundable Credits,
April 2001, HTML or PDF
This issue brief summarizes legislation introduced in the 2001 session that would make changes to the state's refundable income tax credits (the Working Family Credit, Child and Dependent Care Credit, and K-12 Education Credit), as well as other related legislation. Comparison of House and Senate 2001 Omnibus Tax Bills and Governor's Tax
Reform Proposal, May 2001 These three documents outline the positions taken during the 2001 session on taxation. The first document provides a side-by-side comparison of the House, Senate, and Administration's positions on the various types of state taxes, while the other two looks at the positions of each legislative body. These documents emphasize the impact provisions would have on low- and moderate-income families. Governor Ventura's Tax Reform Proposal for the 2001 Legislative Session, Revised March
2001, HTML or PDF
These two documents provide an overview of the Ventura Administration's proposals for tax reform. The first document describes the changes in each major tax area and describes how these changes would change the distribution of tax burden among Minnesotans of different income levels. The second document compares current law provisions affecting nonprofits to the reform proposal, both as it was originally introduced and as it was revised in February 2001. Tax Reform: Is Ventura's Big Plan Too Big?, Minnesota Budget Bites, March 2001 This overview of the Ventura tax reform proposal expresses concerns about its size, which appears to have crowded out needed investments in the spending side of the state budget. The piece also discusses whether enough attention is made to the tax burdens of low-income families. Cost Estimate of Payments in Lieu of Taxes on Charitable Institutions and
Hospitals, December 2000, HTML (overview only) or PDF
(includes detailed table)
Overview of Department of Revenue
Tax Reform Options, November 2000, HTML or PDF These two documents look at the options for tax reform considered
by the Ventura Administration in the winter of 2000. The first document
covers all major tax types, as well as provisions affecting nonprofits.
The second article only includes items that have an impact on nonprofits.
2000 and 1999 Legislative Sessions 2000 Session Tax Bill Tracking Sheet,
May 2000 This 16-page document describes all tax legislation introduced in the 2000 session, grouped by topic. Tax Changes in the 2000 Legislative Session, May 2000, HTML or PDF This overview of the 2000 tax bill describes the income tax rate cuts,
changes to the Working Family Credit, the rebate, auto tabs reductions, and
changes to the sales tax and other taxes. The analysis includes the amount
of tax savings by income level from changes in the income tax and Working Family
Credit, as well as dollar amount and percentage tax cuts and estimate rebate
amounts for families of various sizes and income levels. This information
is summarized in the June 2000 issue of Minnesota
Budget Bites. Omnibus Tax Bills Comparison, April 2000, HTML
or PDF This document is a table showing the fiscal impact of items in the House and Senate omnibus tax bills. Comparison of House and Senate Tax Bills: Major Income Tax
Provisions,
April 2000 This analysis provides side-by-side comparisons of the House and Senate's provisions on major income tax changes and on targeted low-income tax changes, showing for various income levels the percentage and amount of tax cuts going to that income group, the number of filers at that income level, and the average tax cut. Comparison of Rebate Proposals, April 2000, HTML or PDF While the House, Senate, and Governor all were interested in providing a 2000 Sales Tax Rebate based on the 1999 model, there were differences of opinion about whether eligibility should be expanded and whether to make certain groups of people retroactively eligible for a 1999 rebate as well. This issue brief contains a side-by-side comparison of the rebate proposals from the House, Senate, and Governor. Income Tax Rate Cuts, March 2000, HTML or
PDF These three fact sheets look at distributional effects, impact on long-term funding stability, trade offs, and ultimate winners and losers of proposals in three major tax areas. Proposed Changes to the Renter's Credit/Circuit Breaker
Property Tax Refund Program, March 2000 Legislation introduced during the 2000 session would change the Property Tax Refund Program to remove the distinctions between homeowners and renters and to reduce the number of brackets in determining the credit. Such a change would be more beneficial to homeowners than to renters. Conference Committee Should Consider Size, Fairness of Omnibus Tax Bill, April 2000 In this opinion piece, the Minnesota Budget Project offers three principles to guide the work of the Tax Conference Committee: that the omnibus tax bill should be sustainable, that it not increase the regressivity of the state's tax system, and that it include a balance of cuts that are fairly distributed among taxpayers of all income levels. Good Tax Reform Means Looking at the Big Picture, February 2000 In this commentary about the Administration's tax reform process, the Minnesota Budget Project argues for attention to fairness of the overall tax system. The 2000 Legislative Session: What's in Store? Minnesota
Budget Bites, February 2000
1999 Minnesota Tax Cuts: How Much and For Whom? October 1999 This fact sheet describes the dollar amount and percentage tax cut for
families of various sizes and incomes, as well as their estimated sales tax
rebate. It also includes a short description of the omnibus tax bill.
Local Tax IssuesAn Analysis of the Duluth City Council Proposed Ordinance to Impose Payment in Lieu of Taxes on Nonprofit Institutions, January 1998 Duluth was the first Minnesota municipality since 1980 to propose a partial property tax for buildings and land owned by charitable organizations. This analysis measures the impact of such a proposal in terms of revenues raised and on organizations affected by it. |
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