By Tara Bitzan, Executive Director, Alexandria Lakes Area Chamber of Commerce
It was announced last week that Minnesota’s projected budget surplus sits at $17.6 billion, and the debate over what to do with that surplus is again up for debate. This seems to be an ongoing trend in Minnesota.
“This budget surplus isn’t just historically high,” noted Doug Loon, Minnesota Chamber of Commerce President and CEO. “The announced surplus is 90 percent higher than the previous record-high set just last year. While lawmakers approach session flush with cash, employers, employees, and families face high costs and economic uncertainty for the future.”
Despite the fact that the state could be jeopardized by Russia’s invasion of Ukraine, high inflation, rising interest rates, and slowing job growth, Minnesota Management and Budget Commissioner Jim Schowalter stated that Minnesota is well positioned to manage a downturn.
Some of the noted DFL priorities for the next two-year budget include a new paid family leave program, education, and additional childcare programs. Governor Tim Walz said his focus would be on helping those impacted by the pandemic and efforts to curb it, suggesting rebate checks for Minnesotans, a cut to the tax on Social Security income and new one-time spending for schools, child care, climate efforts, and more.
The Minnesota Chamber of Commerce stresses that now is the time to focus on corporate tax reform. Only the state of New Jersey will have a corporate tax rate higher than Minnesota in 2023. But a surcharge currently in effect in New Jersey will sunset, setting Minnesota up to rank as the highest corporate tax rate state in 2024. That’s not a list we want to be first in!
“Legislators have an obligation to act responsibly on behalf of our economy and our people,” Loon added in a recent Minnesota Chamber statement. “After nine consecutive years of budget surpluses, Minnesota should join other states in meaningful tax reforms to encourage investment and create opportunity for our state.”
We urge the business community to speak out now in favor of business tax reform before we lose any more businesses to other states!