ST.PAUL – State Rep. Harry Niska, R-Ramsey, is co-authoring legislation to fully repeal the state tax on Social Security, providing some breathing room for seniors – particularly those on fixed incomes.
Niska said Minnesota is one of just 12 states that still tax social security benefits. With a $17.6 billion state budget surplus, and price increases straining family budgets, Niska said the time is right for a full repeal.
“Our state’s tax structure has left many grandparents feeling like they need to move out of Minnesota which, unfortunately, also means moving away from their grandkids and other family members,” said Niska, who is co-authoring H.F. 136 to fully end the state tax on Social Security. “We need to make sure Minnesota is a place that’s more welcoming to seniors and we can start by ending this unnecessary tax on them. If we can’t make it happen with a nearly $18 billion surplus, when would we?”
Niska indicated a full repeal would benefit 473,000 people with an average tax savings of $1,276. In contrast, Gov. Tim Walz’s budget proposal doesn’t fully repeal the state Social Security tax, with only 43% of Minnesotans receiving some form of relief – on average, $278 per household.
Minnesota’s tax structure is unfriendly to retirees. Reports show our state loses far more domestic residents each year to other states than it gains. Business and personal finance publisher Kiplinger lists Minnesota among its “not tax-friendly” states for retirees, indicating, “The North Star State offers cold comfort on the tax front to retirees.”
Niska acknowledged cold winters play a role in Minnesota’s migration patterns, which he said emphasizes the importance of improving our state in areas the Legislature actually can control.
“Of course, there always are going to be seniors who choose to relocate to warmer locales, but let’s make it more affordable for people who want to live out their golden years right here, in Minnesota,” Niska said. “Seniors have worked hard to establish families and a home in our state, and these Social Security dollars already have been taxed once. It’s unjust to tax them a second time and the bill I’ve co-authored would put a stop to that.”
Democrats, Niska said, signaled they were all-in for a repeal of the Social Security tax last fall but now, more than a month in to the 2023 session, bills related to this subject have been left on the back burner in the House.
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