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Low-income Minnesotans would get a credit of up to $60 a year to offset the new clothing tax. To come out ahead, a Minnesota family would have to spend less than $1,000 a year on clothing.
The Senate proposal includes millions of dollars in new economic development and aid for schools and local governments, which DFLers hope will drive down property taxes.
The Senate plan carves out tax beaks for dental clinics, airplane equipment and investors in fledgling companies. Also included is help for communities whose home companies are eyeing major expansions, such as 3M in Maplewood and the Mayo Clinic in Rochester.
“Rochester needs to keep up with Mayo’s growth,” Skoe said. “We think this is a wise use of state resources.”
Skoe said the proposal also honors a long-standing DFL goal of lowering property taxes for most Minnesotans.
While the House favors direct property tax rebates, the Senate prefers to have the state take on a larger share of education funding and boost aid to local governments.
The Senate plan also includes a new 13 percent wholesale tax on sports jerseys and other memorabilia, which could then get passed on to taxpayers in the form of higher price tags. Combined with the sales tax, the total tax on sports memorabilia would approach 20 percent.
The memorabilia tax is expected to bring in more than $32 million over two years and help pay the state’s share of the new Minnesota Vikings stadium. State leaders are scrambling to find new money to pay for the stadium because the preferred revenue source, electronic pulltabs, has fallen far short of projections.
Skoe said the Senate plan would slice off a small portion of that new memorabilia tax, about 5 percent, for youth sports activities statewide.
Baird Helgeson • 651-925-5044