With days left for deal, House tax committee bargaining comes into view

  • Blog Post by:
  • May 15, 2013 - 5:50 PM

Updated at 5 p.m.

By Rachel E. Stassen-Berger and Jennifer Brooks

After a day of exchanging offers, the Minnesota House and Senate are still hashing out differences on how to raise taxes and which ones to raise.

The negotiators are still dickering over how much to raise taxes in a new bracket for high earners, whether to raise the alcohol tax and how much more smokers will pay on a pack of cigarettes.

The deadline for the end of session is looming, and lawmakers are hustling to finish their work.

The House also moved up on their proposed tax on people more on couples than $250,000, and high earning singles. In the morning, they'd proposed hiking the rate to 8.84 percent. By evening, they'd hike to 8.94 percent.

The Senate's latest offer hiked it even more.

All the current legislative plans would put Minnesota's tax rate among the highest on high earners, a position many lawmakers had hoped to avoid. They would leapfrog high-tax New York, which has a top rate of 8.82 percent.

The House plans would hike the alcohol taxes and a $1.60 per pack cigarette tax.  In the face of Senate opposition to any tax hike on alcohol, by late afternoon, the House offered to drop their proposed 7 cent-per-glass tax increase to 6-cents-per-drink.

The Minnesota Senate countered Wednesday afternoon with an offer that hews to few of the House positions. No alcohol tax, a lower cigarette tax and $400 million in new revenue from expanding sales tax to new items.

In its late afternoon offer, the House revived a plan to bring in $2.5 million from "parallel taxation of direct satellite services" and $4.7 million in a pro sports suite tax. Both of those revenue sources could  be used to back fill a funding gap between what new gaming was supposed to bring in for the new Vikings stadium and what they are actually earning in the months they've been active.

Capitol leaders have said they hope to set aside between $25 million and $30 million this year in case the gaming revenue is not sufficient in the long-term to pay for the state's share of the new Vikings stadium.

See the details of both the House offers and Senate offer below.

House and Senate tax specialist spent Wednesday shuttling in and out of public meetings, taking little and making offers. They expected to continue those meetings into the evening.

Although lawmakers face a mandatory Monday deadline to get all their work done and had yet to complete a single budget bill by Wednesday evenings, their leaders said they remain unconcerned.

Several smaller budget measures are nearly buttoned up and could get their final votes soon.

"Today's only Wednesday so I'm not worried," Senate Majority Leader Tom Bakk, DFL-Cook, said in the morning. "I believe we'll have plenty of time to get it done...We're pretty well positioned to get most of the bills done in the next few days." 

Wednesday afternoon, the legislative specialists hammering out the jobs budget finished their work, which prepares that measure for a House vote late in the evening.

Along with taxes issues, lawmakers have yet to agree on whether to raise the gas tax and whether to increase lawmaker pay, which could cause some friction in the coming days.

Here's the House offer:

House tax by Rachel E. Stassen-Berger

Senate offer:


Senate Offer OTB 1pm_1 by Rachel E. Stassen-Berger

House offer II:


House Tax II by Rachel E. Stassen-Berger

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