Taxes

Tax Cut Driven Budget Problems Escalate in Future

The fiscal year (FY) 2018-19 state general fund budget surplus—projected to be $1.65 billion last February—could easily turn into a $104 million deficit after taking into account the tax cuts and other measures enacted earlier this year, as noted in the first part of this series. Because the revenue loss from many of these tax…

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Big Tax Cuts Jeopardize Fiscal Solvency

Going into 2017, Minnesota was looking at a large budget surplus for the upcoming biennium. By the time the dust had settled at the end of the 2017 special session, the surplus had been reduced by nearly ninety percent. After including the impact of lower than expected revenue collections and other factors, the surplus projected…

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While Minnesota Reinvests, Wisconsin Disinvests

Tax cuts enacted in the Badger State in recent years have contributed to a more regressive tax system and recurring revenue shortfalls, as noted in the preceding article in this series. Meanwhile, tax increases in Minnesota have not only made the tax system less regressive, but also helped to produce a significant surplus after years…

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The Connection Between Public Policy and Prosperity

Since the end of the Great Recession, Minnesota has comfortably surpassed Wisconsin in terms of GDP and income growth, and job creation. Based on newly released 2016 data from the American Community Survey, median household income in the Gopher State is 15.5 percent ($8,800) greater than in America’s Dairyland. Caution is in order when drawing…

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Put Your Money Where Your Mouth Is

The education achievement gap in Minnesota is a real and persistent problem. For example, the 2016 graduation rate among black students was 22 percent below that of white students, while the rate among American Indian students was 35.5 percent below. While the gap in graduation rates has narrowed in recent years, it is still large…

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Income Inequality, Tax Regressivity are Worse Than We Thought

There has long been convincing evidence—both at the state and national levels—that income inequality has accelerated in recent decades, with an increasing share of wealth concentrated in fewer and fewer hands. Extreme income inequality—coupled with stagnant or declining real wages—undermines a consumer economy, since working families are less able to purchase the goods and services…

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School Aid: Halfway Back to 2003

Over the last fifteen years, trends in state aid to Minnesota school districts can be framed as a tale of two time periods: from fiscal year (FY) 2003 to 2012, real (i.e., inflation-adjusted) per pupil state aid to Minnesota school districts fell sharply; since FY 2012—and especially since FY 2014—real per pupil state aid is…

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Undocumented Immigrants as Taxpayers

Undocumented immigrants in the United States have long been a hot political topic. The vast majority of these immigrants are not “criminals, drug dealers, and rapists,” but instead are “integral to the nation’s economic growth” and have little to no negative impact on native-born workers in the long term, according to a recent report from…

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Minnesota Business Property Taxes Per Capita, Employee

Minnesota business property taxes really aren’t that high, based on analysis of information from the annual business tax report prepared by Ernst & Young (EY). As described in the preceding article in this series, Minnesota’s business effective property tax rate is below national and regional averages and less than in most other states. An analysis…

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Minnesota Business Property Taxes Below Average

A common mantra among conservatives is that Minnesota business property taxes are high relative to other states—a view promulgated by Minnesota’s business lobby and interest groups. Analysis of data from impartial sources, however, suggests that the opposite might be true. The most commonly cited claim that Minnesota business property taxes are among the highest in…

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