The Minnesota Senate has given approval to another $101 million in tax breaks, but the array of relief differs from a House version. Thursday’s 57-6 vote sets up final tax negotiations with House tax writers. Both chambers are led by Democrats. The Senate bill expands a sales tax exemption for local governments to those that coordinate services across boundaries. It adds to city and county tax exemptions approved a year ago. The bill also provides tax credits for volunteer firefighters, credits for parents who hire reading tutors and assistance to counties on the front-lines of the aquatic invasive species battle.
A House bill focuses tax relief on beefing up refund programs connected to the property tax. That chamber’s bill has a similar size. Minnesota’s tax collectors took in slightly less than they were counting on in February and March, but finance officials aren’t sounding alarms. The state drew $67 million, or 2.5 percent, less than forecasters were predicting. A budget update released Thursday by the Department of Minnesota Management and Budget says the shortage had to do with timing issues in payments they expect to come in later. Income taxes for individuals outpaced expectations by 2.2 percent.
The report looks only at revenue and not at spending. Still, finance officials are adjusting economic growth estimates down a tad, which was partly attributed to the bad winter around the country causing disruptions and caution in the economy. The quarterly updates aren’t used by lawmakers when setting the state budget.
Negotiations will commence after Easter.