The 2013 Legislature's first major tax bill, adapting the state tax code to recent federal tax changes, warrants a backhanded Minnesota compliment: Coulda been worse.
This is a bill that taxpayers and tax preparers around the state have been waiting for. It aligns the state income tax code with most of the changes Congress enacted on New Year's Day, simplifying preparations for most filers and slightly reducing their tax burden.
The bill, sent to Gov. Mark Dayton Monday for an assured signature, is both a bit tardy and a bit cluttered with partisan add-ons. But until last week, legislators were contemplating further additions that would have led to more delay and taxpayer inconvenience. Many of the ultimately discarded additions were provisions of a tax bill that Dayton vetoed in 2012 but that this newspaper supported. We hope to see them back in good time. Now, with tax-filing season in full swing, is not that time.
The Legislature's DFL majorities finally picked up the pace. But senators could not resist the temptation to hang a few controversial ornaments on the bill.
The biggest outcry rose over a change in the composition of the governing board of the Iron Range Resources and Rehabilitation Board. Change was needed because redistricting had cost that board a quorum and, consequently, its ability to operate. But House and Senate DFLers differed over how best to amend state statutes to make the board functional again.
By attaching their version to a bill that the House could take or leave but could not amend, senators pulled a procedural power play that left House DFLers spluttering but, ultimately, unwilling to further delay an overdue bill. The episode illustrates that one-party control of the Legislature offers no guarantee of lawmaking harmony.
Another Senate amendment is more concerning. It repeals a statutory requirement that the federal tax burden be included in a biennial Revenue Department report, due March 1, that measures how the state and local tax load is distributed among Minnesotans across income levels.
That requirement, enacted by Republican majorities in 2011 as part of the shutdown-ending budget agreement with Dayton, has a partisan tinge of its own. It's expected to show that while upper-income Minnesotans pay a smaller share of their incomes in state and local taxes than do those with middle incomes, their total tax burden with federal taxes included is higher. That information is seen as undercutting Dayton's argument for higher state income taxes on top earners.
