Legislators Get Tax Agreement 17 May 13

No sales tax on clothing or consumer goods or services, a top bracket income tax increase, and a $1.60 per-pack hike in the cigarette tax. Those are key features of a tax deal Governor Dayton and DFL legislative leaders announced Thursday night. Governor Dayton says the budget is a result of commitments made…and kept. Married filers with income over $250,000 would be taxed at 9.85%. The governor says the wealthy must pay their fair share so the state can invest in its future. The investments include all-day kindergarten, early childhood education and freezing tuition at higher education institutions. There will also reportedly be $400-million in property tax relief. Legislators will be working through the weekend on budget bills.

Governor Dayton is proposing a cigarette tax increase plus money from closing a corporate tax loophole as additional revenue sources to help pay for the new Vikings stadium. House Speaker Paul Thissen says the proposal is something worth considering. He is hoping that lagging electronic pulltabs will perform, but says he wants to make sure resources are in place to pay for the Vikings stadium. But opponents of the new plan say that lawmakers should re-look at the whole funding scheme and not just “throw this together” now.