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DFL-backed tax hikes on upper-income Minnesotans and cigarette smokers enjoy broad popular support, a Star Tribune Minnesota Poll has found.
An income tax increase on the wealthiest Minnesotans, the centerpiece of Gov. Mark Dayton’s budget, is supported by 58 percent of those polled, compared with 36 percent opposed. Even more popular is the $1.60 per pack jump in cigarette taxes, favored by 64 percent with 32 percent opposed.
Republican minorities in the House and Senate fought the tax increases, the chief elements of a tax bill that will raise $2.1 billion over the next two years. Higher taxation, they said, was unnecessary and would harm the state’s fragile economy.
But in a poll of 800 adult Minnesota residents taken June 11-13, both the income and cigarette taxes passed by the Legislature in late May and signed into law by Dayton are clear winners. That may be due in part because the increases nick a fraction of the public, rather than all taxpayers. Originally, Dayton proposed more general tax hikes, including a sales tax on clothing and most services, which drew widespread criticism and was withdrawn. The poll has an error margin of plus or minus 3.5 percentage points.
“I think it reflects what Minnesotans understand, the need to make new investments in education, job creation ... and that we found a fair and acceptable way to do that,” said House Speaker Paul Thissen, DFL-Minneapolis, of the poll results.
Income tax affects few
House Minority Leader Kurt Daudt, R-Crown, said the polls reflect the fact that most Minnesotans are unaffected by the two main tax hikes. The tax increases, he said, “frankly will hurt Minnestoa’s economy and hurt hardworking Minnesota families.”
Bruce Jawer of Rochester, an educational adminstrator for the Mayo Clinic, said he favors the cigarette tax because of the health problems smoking causes and the income tax increase because he believes in a progressive income tax system.
“Folks who make more money have a duty to contribute more to the welfare of the country and the state,” Jawer said, noting that he himself may fall into the “upper-income” category at times. “History shows that when things get too out of balance between the rich and the poor, it leads to instability.”
Tom Penn, a small-business owner from Excelsior who also works in health care, said the income tax hike could hurt enterprises such as his, in which business income is taxed as personal income. “If you’re raising taxes, you’re preventing us from reinvesting in the businesses,” Penn said.
He said he does not necessarily oppose raising cigarette taxes, but says cigarettes, liquor and other such items should be taxed similarly, rather than singling out smokers.
Legislators tangled throughout the session over higher taxes, with Democrats arguing that years of recession and reduced revenues had left the state facing a series of deficits and mounting cuts in services. To remedy that, the Legislature created a new tax rate of 9.85 percent for adjusted gross income above $250,000 for couples and above $150,000 for individuals. Income below those levels will continue to be taxed at existing rates. Dayton has said the increase applies to about 2 percent of all taxpayers.
The cigarette tax increase was proposed both to raise revenue and to discourage smoking. According to the Minnesota Department of Health, about 16 percent of the state’s adults smoke.
Support strongest in metro
The state’s most-populous counties, Hennepin and Ramsey, also offered the strongest support for the tax increases, with nearly three-fourths of residents favoring the income tax increase. More than half of those in non-metro Minnesota backed the income tax increase. Only in the suburbs did support dip below 50 percent, with 49 percent supporting compared with 43 percent opposed.
A whopping 68 percent of women supported the increase, compared with only 26 percent opposed. Men opposed the income tax increase by a 48-46 margin.
Support for the income tax was strongest at the two ends of the age spectrum — 67 percent among those ages 18-34 and 62 percent among those ages 65 and over. Political persuasion was another indicator for where respondents stood. More than 90 percent of DFLers supported the income tax, while 76 percent of Republicans opposed it. Among independents, the tax hike was favored by a 54-35 percent margin.
The margin of support was stronger across the board for the cigarette tax hike. Again, women led the way with 69 percent support, but men also supported the cigarette tax hike by a 58-39 percent margin. Support was strongest in the 18-34 age group, where a generation of anti-smoking efforts may have dimmed the allure of smoking. Some 72 percent in that age bracket favor higher cigarette taxes.
Those identifying themselves as Republicans opposed the measure, with only 41 percent in favor and 54 percent opposing. Democrats favored the hike by an 86-14 percent margin.
Support in Hennpin and Ramsey counties was the largest at 73 percent, but it was also solid in the suburbs (56 percent) and outside the metro area (62 percent).
Lori Denton of Barnum, Minn., said she supports the cigarette tax hike because, while she is not a smoker, she has family members who smoke and she wishes they would quit. “I think it’s OK to tax it high,” she said.
On the income tax, Denton would rather have everyone pay a similar percentage of their income in taxes, and isn’t sure the new upper-income tax will accomplish that goal.
“I think it should be more equal,” she said.