Tax cuts should be part of budget plan
Minnesota lawmakers were disappointed when the February state economic forecast predicted a surplus of only $900 million for the current budget. They had been hoping for the earlier forecast of $1.2 billion.
That $900 million might not be enough to fulfill as many of the new programs and extended services on their wish lists as they had hoped.
This past week some legisalators have been rolling out some proposals for tax cuts. One of them, a bill from Rep. Jason Isaacson, would lower the state’s second tier tax rate from 7 percent to just under 6.5 percent. This is a tax cut aimed at the middle class, and would affect some 1.3 million tax returns. It would provide an average $230 tax break for those taxpayers, at a cost to the state of $493 million.
What makes Isaacson’s proposal interesting is that he is a DFLer. His proposal gained some praise from Republicans who are always looking for tax cuts. Isaacson said he wanted to focus tax cuts on the middle income taxpayers, not the wealthy.
With five weeks left in the session, the issues of tax cuts is certain to generate a lot of debate and legislative push and shove.
We do want to see the Legislature take care of unfinished business on transportation, but with $900 million, there should be something for a meaningful tax cut.