On January 26, Governor Walz unveiled his budget proposal for the 2021-2022 biennium. State Representative Bjorn Olson (R-Elmore) was troubled that the governor prioritized $1.7 billion in tax increases in his plan.
“Income and business tax increases are the wrong approach towards setting a budget in the midst of the COVID-19 pandemic,” Olson said. “While we have a projected budget deficit, those numbers have been improving over the past few months. If we still have a manageable budget deficit after the updated forecast in February, we should utilize our budget reserve and not punish Minnesotans.”
Governor Walz is proposing a 10% income tax hike to Minnesota’s top tax bracket, and a 15% hike to Minnesota’s business tax. This would make Minnesota the state with the 2nd highest business tax and the 3rd highest income tax rate in the country.
While Minnesota faces a projected $1.2 billion budget deficit, Olson noted the governor is only proposing a .3% state spending reduction ($150 million) out of a more than $52 billion budget.