(The Center Square) – After Minnesota lawmakers kicked off the 2024 legislative session= Monday, the Minnesota Chamber of Commerce said lawmakers should slow spending and tax hikes.
The DFL-trifecta Legislature blew through nearly an $18 billion budget surplus on spending increases and boosted general fund spending by $19.3 billion or 37%, triggering a deficit in 2026 and 2027.
In 2023, the Legislature legalized adult-use marijuana, passed a metro area sales tax increase of .75%, increased the motor vehicle sales tax from 6.5% to 6.85%, and increased the cost of tab fees.
The chamber website says that “Minnesota has diverged from the national trend of reducing taxes and reducing regulatory burdens. Instead, lawmakers have increased costs precipitously for employers and employees. This puts the state at a competitive disadvantage as our economic growth and investment are lagging.”
Minnesota will also levy an extra $0.50 fee on online purchases beginning July 1, 2024, on any non-food purchase more than $100 made online and delivered to a door.
The tax bill contained $1.18 billion in tax increases on businesses over four years.
Lawmakers imposed $1 billion in tax increases on higher-income taxpayers over the next four years. The tax bill imposed an additional 1% tax rate on top of the current 9.85% rate for net investment income above $1 million.
The new paid leave mandate forces employers to offer 12 weeks of paid medical leave and 12 weeks of paid family leave (maxing out at 20 weeks total over 52 weeks. A new state agency with over 400 full-time employees will administer the program paid for through surplus funds and a considerable increase in payroll taxes, which can be split between employers and employees. This will take effect on January 1, 2026.
Minnesota employers and workers must pay about 18% more than originally thought for the program.
House Speaker Melissa Hortman, DFL- Brooklyn Park, posted on social media celebrating DFL accomplishments.
Lawmakers face two committee deadlines for the 2024 session: a March 22 deadline for committees to pass bills that aren’t major appropriation or finance bills and an April 19 deadline for committees to act on appropriations bills.
