MN Senate Backs $1.8B Tax Bill, Following Initial Fail

By KBJR News 1

April 29, 2013 Updated Apr 29, 2013 at 8:46 PM CDT

St. Paul, MN (NNCNOW.com) - It took not one, but two rounds of voting by lawmakers in the Senate Monday to pass a $1.8 billion tax bill.

It's the final piece of the budget puzzle that aimed to solve a $627 million dollar deficit.

Contentious debate surrounded the bill which calls for tax hikes for Minnesota's wealthiest, repealing the clothing sales tax exemption and a tobacco tax.

In a surprising and for some a confusing move, several DFL Senators voted against the bill, initially causing it to fail.

However, when the bill was put up for a vote a second time, there was a change of heart among some of the lawmakers after a private meeting.

Tax Bill Breakdown:

- Individuals who earn $80,000 or more and joint filers with a taxable income above $141,000 would see their tax increases jump from 7.85 percent to 9.4 percent.

- The bill also calls for more taxes on services we use on a daily basis like hair cuts and oil changes. The bill broadens the tax base while lowering the rate to six percent.

Prior to Monday's debate, Senate lawmakers talked about the potential impact the bill will have on Minnesotans it's passed into law.

"We have to do that at some point or the sales tax becomes a diminishing source of revenue, it already has, and it continues to do that. The Senate tax bill does do that, it moves into some consumer services but it does include any business to business tax that some people were really concerned about at the start of the session," said Sen. Roger Reinert (DFL-Duluth).

"It's going to hit everyone in Minnesota. We're going to be asking the hard workers of this state to reach into their pockets to bring out more money to send down here to the Capitol to waste on wasteful spending that we think is unnecessary," said Senate Minority Leader David Hann.

The tax bill, which does not include the controversial alcohol tax approved in last week's house tax bill, received a 35 to 31 vote.

It now heads to conference committee.

Kevin Jacobsen
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