By Rep. Shane Mekeland
Minnesotans are feeling the weight of increased costs at the gas pump, at the grocery store and pretty much everywhere else these days with price hikes soaring at 40-year highs.
Many Minnesotans also are working hard to recover from losing income during the pandemic when restrictions and all-out shutdowns impacted workers.
Those are just a couple of reasons it was so disappointing to see the March 15 deadline to enact legislation preventing a tax increase from taking place pass without action in the House. The real kicker is the House allowed this tax increase to occur at a time the state is sitting on $10 billion in surplus revenue.
This issue arose because the state’s unemployment insurance trust fund was depleted with more people out of work during the pandemic. The federal government provided funding to the state to keep the program afloat and now that debt of more than $1 billion is due.
The governor, House Republicans, Senate Republicans, and most Senate Democrats have supported passing a clean bill to fully replenish the UI funds. The Senate one month ago approved by a veto-proof majority legislation to do so.
But, instead of bringing the Senate’s bill to the House floor for a approval and sending it to the governor to sign and put this issue to rest, House Democrats continued to withhold that bill through the March 15 deadline. House Republicans made a move to declare urgency on the matter Monday to take up the Senate bill for a vote but, for the second time in the past week, that motion was blocked.
Now, a tax increase is set to take place to pay the state’s federal debt even though Minnesota has a surplus of around $10 billion. The consequences are highly concerning and even the Minnesota Department of Employment and Economic Development has sounded alarms. One recent article quotes Greater Minnesota employers saying they face tax increases in the tens of thousands of dollars next year, in one case a 130% increase which translates to a $21,000 spike.
And, let’s be clear: Those tax increases are going to impact us all, whether it’s through higher prices for goods and services, reduced wages or diminished benefits. That 12-pack of Diet Coke already costs a lot more than it did just a short time ago and this tax increase will only serve to raise its price even more. In turn, these higher costs we pay mean more sales tax is collected by a state that already has $10 billion in surplus revenue.
It never ends, which gets us back to the point: Our mission in the Legislature this session should be to do all we can to help Minnesotans get back on their feet after what has been, for many, an extremely challenging couple of years. The state has a historic surplus that should be used for tax relief but, instead, the House majority allowed a tax increase to take place.
Aside from mere dollars and cents, the added strain this tax increase is likely to cause people is concerning. Mental health issues seem to be contributing, on some level, to the rising rates of violent crime in our state. We need to get a grip on this dangerous trend as well and House Republicans recently outlined a package of bills which focuses on three key areas: crime prevention and accountability for criminals; police recruitment and retention; and holding the criminal justice system accountable.
If nothing else, Minnesotans and our visitors deserve to be safe.
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