Archive for March 2018

The Federal Tax Act’s Minnesota Impact: Steeply Regressive

Corporate elites and wealthy Americans celebrated when Congressional conservatives and President Trump rolled out the so-called “Tax Cuts and Jobs Act” (TCJA) late last year—and with good reason. The TCJA was overwhelmingly regressive, sending a disproportionate share of tax relief to high-income households that have benefited from rising income inequality for decades. Analysis confirms this…

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Minnesota’s Only Frozen Tax: The State Business Property Tax

State and local taxes in Minnesota typically grow over time in response to increased consumption and rising economic activity, and to keep pace with the growing demand for public services. There is one notable exception to this rule: the currently frozen state business property tax. Because this tax is frozen, the cost of government shifts…

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What Can Batteries Do for You?

The United States just surpassed an important milestone, and you might not have noticed. The country’s electric grid can now store over a billion watts for one hour (1 GWh) with batteries for later use. By the end of 2018, analysts predict that capacity to double. Some even predict 50 times that within the next ten…

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Generating State Revenue Through Corporate Tax Conformity

The so-called “Tax Cut and Jobs Act” (TCJA) enacted by Congress last year made massive changes to the federal tax code. Minnesota and other states must now decide if and how to conform their own tax codes to the federal changes. As we note in part 1 of this series, the qualified pass-through income tax…

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Federal Tax Act Pass-Through Provision: What a Mess!

Tax laws should be simple and direct. Taxpayers should be able to understand and comply with them without the assistance of an army of attorneys and accountants. The treatment of pass-through income in the new federal tax law passed late last year—the so-called “Tax Cut and Jobs Act” (TCJA)—fails miserably by this standard. Specifically, the…

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2018 Local Government Aid Funding in Perspective

Local Government Aid (LGA) has long been an important source of funding for city services and property tax relief. A 2018 LGA funding hike provided valuable new resources to cities, but not quite enough to keep pace with inflation and population growth from 2017 to 2018. Today total real (i.e., inflation-adjusted) per capita (per person)…

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Time to Raise the Renewable Portfolio Standard?

Minnesota’s Renewable Portfolio Standard (RPS)—sometimes called a Renewable Energy Standard (RES)—was last updated in 2007. Most utilities have met it ahead of schedule. All but twelve states have some sort of RPS, twenty-nine of which are mandatory. Is it time for an update in Minnesota? What’s feasible? The details and progress In 2007 lawmakers codified…

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Growth in Homestead Share of School Property Taxes

School property taxes fell significantly from 2001 to 2002.* But that relief eroded over time, as noted in part 1 of this series; homeowners have been particularly hard hit. The growth in homeowners’ share of the school property tax bill is not the result of real school spending increases, but the nuances of Minnesota’s property…

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