Activity has certainly been on the rise in St. Paul in recent days, as the Minnesota legislature moves ahead with its proposals and policies as part of the current state session.
This past week, the Senate discussed both the omnibus E-12 education bill, as well as the omnibus health and human services bill, and this week it is scheduled to take up the omnibus tax bill.
According to District 16 Sen. Gary Dahms, the proposal being offered by the Senate majority, released this past Wednesday is “quite a bill.”
The proposal, said Dahms, raises $2.5 billion in new taxes and includes part of the proposals initially presented by Gov. Mark Dayton to increase the number of products which would fall under the sales tax. The proposal would drop that sales tax rate across the board to 6 percent, and projections show it would mean about $800 million in new revenue.
The tax bill would also increase the tax rate on the top tier of Minnesota’s incomes, but Dahms said the Senate proposal in-cludes a lower salary level than originally discussed. The reason for the increase in the tax revenue proposal is to cover the $3 billion proposed budget increase over the last budget.
“The taxes are just too high,” said Dahms.
Dahms said the state was on the right track during the past two years, as it lived within its means, which was indicated in the increase in state reserves as well as a growing economy that saw a 2 percent drop in unemployment statewide.
“The economy is moving forward,” said Dahms, adding the tax increase proposal combined with the health care exchange and affordable care act requirements are going to put a huge burden on the state financially.
Dahms said the state can move forward without raising taxes by utilizing some of its reserves, adding the long-term im-pact of these proposed increases is going to be compounded putting the state back facing a multi-billion dollar deficit.
“This plan would spend so much money, and unfortunately that is where we are at right now,” Dahms said, adding when you start adding new money you have to constantly be looking to find more ways to keep that new money coming.
“All of this is what got us in trouble two years ago,” said Dahms.
In addition there is discussion about a bonding bill, but Dahms said the good news in the Senate is that bonding bill would only include funding to help repair infrastructure in the Capitol building.
For now, said Dahms, we all need to just wait and see what happens.