Minnesota Gov. Walz has proposed tax credits for 2.5 million families

Millions of Minnesota family will receive full checks of up to $2,600 from the state’s large surplus funds under the budget plan announced by Gov. Tim Walz on Tuesday, said that residents will receive the largest package of tax cuts in the history of the state.

Direct payments are at the center of the $65 billion two-year budget plan he released Tuesday, after announcing other proposals last week for increased spending on education, families, health , public safety and housing.

“This is a reasonable budget that will continue to generate growth, reduce taxes on Minnesotans while improving all areas of their lives,” Walz said.

MINNESOTA GOV. WALZ HAS PROVIDED THE PREPARED TAX CODE 1 OF THE BUSINESS RESIDENCE.

These checks will be designated as tax payments equal to $2,000 for families with incomes below $150,000, and $1,000 for single filers with incomes below $75,000. They will be exempt from federal taxes. Taxpayers can also get an extra $200 for each dependent – up to three. But those who have more than the income have nothing to gain, said Revenue Commissioner Paul Marquart.

More than 2.5 million people in Minnesota will receive checks if lawmakers approve the plan, officials said.

Walz’s budget also includes expanded tax credits for families with children and child care spending. After all, an average family of four could get back $10,000, he said.

Democratic governor’s budget it also includes lower taxes on Social Security income for more than 350,000 families, but not a complete elimination of the tax, as expected by Republicans and some Democratic lawmakers. Social Security recipients with high incomes will still owe taxes on their benefits. But 43% of families receiving Social Security will save an average of $278 this year.

The tax cut is about $5.4 billion worth of relief, said Finance Commissioner Jim Schowalter.

Republican leaders quickly attacked the governor’s plan for its big jump in total spending from the $54 billion in the current budget, which runs through June, and for its the desire to use surplus data to completely eliminate the state’s Social Security tax on all income. higher or permanent tax cuts.

“We have a surplus of $17.6 billion at the moment. This budget will cover all of that. In addition, the government will grow by 25%,” said the Senate Minority Leader Mark Johnson, of East Grand Forks, to reporters.

“If we can’t cut taxes now, when will we be able to?” That’s the question of House Minority Leader Lisa Demuth, of Cold Spring.

Democratic Minnesota Gov. Tim Walz proposed credit checks of up to $2,600 for 2.5 million households in Tuesday’s budget.
(Glen Stubbe/Star Tribune via AP)

The increase comes from a combination of stronger-than-expected tax revenues, as well as lower spending, which provides the many individual expenses, including the governor’s expenses. But the savings in future income can support continued spending or lower tax cuts.

The governor’s plan is based on the budget that sets the main work of the 2023 Legislature. But his fellow Democrats, who currently control both chambers, will have their own ideas about spending and tax priorities, and the final budget will be the result of committee deliberations, floor debates and private negotiations over the next few months.

The first opinion of the leaders of the Democratic government, was good, despite the lack of commitment to the main parts of the budget of the governor.

“I commend the Governor for proposing a strong budget and an inspiring vision for our future,” House Speaker Melissa Hortman, of Brooklyn Park, said in a statement. “I look forward to our continued partnership as we craft our budget and pass legislation to build a better Minnesota for everyone.”

“Governor Walz’s budget reflects many of the priorities that Minnesotans have said they value, including plans to build an economy that works for everyone by lowering costs for families and ensure strong schools, safe communities and a healthy economy,” Senate Majority Leader Kari Dziedzic, of Minneapolis, said in a statement.

Walz also suggested paying off the state’s portion of the debt on US Bank Stadium, the home of the Minnesota Vikings, 22 years early. Revenues from electronic games and scratch-off tickets – which are now planned for the stadium’s debt retirement and are stronger than originally expected – will go to the state’s general fund, the Schowalter said.

MN GOV. WALZ RECOMMENDED $300M for public safety, $1B for affordable housing in budget plans.

The governor’s budget also includes some tax increases that are sure to spark debate, including an increase in the income tax. of high-income taxpayers and the payroll tax to fund a paid family and medical leave program that goes into effect in 2026. annual. license renewal fees, which fall as the vehicle ages, will not increase but will gradually decline.

An economic model update expected at the end of February could result in some changes. The Legislature should be adjourned to May 22.

The session has begun quickly since it convened Jan. 3. Many Democratic priorities are moving quickly through the legislative process, including several proposals that were blocked by the GOP earlier in the Senate. four years ago.

These include paid family and medical leave, legalization of recreational marijuana, climate change legislation requiring Minnesota utilities to switch to carbon-free electricity by 2040 and a ban on conversion therapy for teenagers. LGBTQ.

The proposals also include funding for more attorneys for the attorney general’s office, obtaining driver’s licenses regardless of immigration status, creating an Office for Missing Black Women and Girls and murder, the prohibition of discrimination based on hair, free meals for all students. and requests to make voting easier, including the return of rights for criminals when they get out of prison.

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Walz signed his first bill in more than a week at the event: A $100 million tax cut that satisfied state tax laws and federal laws. Awaiting his signature is an extension of unemployment benefits for workers from the Iron Range. And the full Senate is scheduled to vote Friday on the abortion rights bill passed by Walz that Walz has promised to sign.

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