House DFLers released a small tax cut proposal Wednesday, providing breaks for farmers, homeowners and small businesses owners.
“We were pleased that we moved forward so quickly this session to cut taxes for more than one million Minnesotans, but we have more work to do this session to continue making progress,” said House Taxes Committee Chairwoman Rep. Ann Lenczewski, DFL-Bloomington. “We believe this is a responsible way to continue expanding our economy from the middle-out while maintaining our stable budget into the future.”
The measure includes $45 million in targeted property tax relief to Minnesota homeowners, renters, and farmers.
An average family farmer in Minnesota will see $460 in property tax relief, under the proposal. Homeowners will get some relief through a one-time increase in the homestead credit. Renters will see a one-time increase in a credit that will aid about 350,000 Minnesota renters.
Rep. Jim Davnie, DFL- Minneapolis, who chairs the House Property Tax Division, said farmers are still experiencing property tax increases due to significant increases in market value. This comes despite significant money being devoted by the state to buy down property taxes.
“This bill will build on our progress and help put more in the pockets of homeowners, renters and farmers,” Davnie said.
House Democrats want to give a property tax cut for small businesses with property value less than $1.1 million.
The measure also provides tax relief to our active military members by extending our active military income tax subtraction to National Guard service members in the Active Guard Reserve.
This is the second major tax proposal of the session. Gov. Mark Dayton signed the first one last week, which provided about $440 million in tax relief for more than 1 million Minnesotans.
Legislators are still dealing with about half of the $1.2 billion projected budget surplus. Along with the tax cuts, legislators set aside $150 million to bolster the state’s budget reserves.