ST. PAUL – State Representative Bjorn Olson (R-Elmore) said local business owners will soon be facing a senseless tax increase unless the Minnesota House Democrat majority decides to move legislation forward.
On March 15, business owners will face a 15% or more payroll tax hike. This is due to record-setting unemployment claims that depleted Minnesota's Unemployment Insurance (UI) Trust Fund at the start of the pandemic. The federal government provided more than $1 billion to make up for the shortfall. Now, to make up for that loss, payroll tax rates are set to increase.
Olson noted Minnesota has more than $1 billion in federal COVID relief funds waiting to be allocated, as well as a nearly $8 billion budget surplus.
“Local business owners have been suffering mightily under the Walz/Biden economy, whether its on cost of living increases for food, gasoline and energy, supply chain issues keeping products off their shelves, or the inability to find enough employees to stay open,” Olson said. “We are all in this together, and it’s better for everyone if we prevent our local employers from facing a ridiculous tax increase.”
In the Minnesota House Workforce and Business Development Policy and Finance Committee, a bill was heard recently that would allocate more than $1 billion in American Rescue Plan Act of 2021 funding to replenish the Unemployment Insurance Trust Fund. Olson said the Minnesota Senate will soon approve a similar proposal. But Minnesota House Democratic leadership wants the UI Trust fund bill to be packaged with other DFL priorities, which will obviously slow progress to a stop.
“A stand-alone bill that eliminates the tax increase on our employers would receive overwhelming support in the Minnesota House,” Olson said. “Business owners continue to struggle and they want lawmakers to stop this unnecessary tax hike from taking effect. They are not interested in being used as political pawns by the House majority.”