| For Immediate Release | For more information contact: |
| May 10, 2000 | Erik Paulsen (651-296-7449) |
ST. PAUL In a marathon session, ending late Wednesday morning, the Legislature overwhelmingly approved $350 million in permanent income tax and license tab fee reductions and a $658 million tax rebate. Rep. Erik Paulsen, (R-Eden Prairie), a member of the House Tax Committee, said the bill was another victory for the people of Minnesota.
"Added to last year's record tax cuts and rebates, Minnesota continues to move in the direction of getting out of the top 10 states in taxes, said Paulsen. "Over the last two years, we permanently cut taxes by $3 billion and rebated another $2 billion directly to the taxpayers. I think that says a lot."
Under the bill, income tax rates will be reduced across-the-board, benefitting every Minnesotan. The lowest and highest tax brackets will be reduced .15 percent and the middle bracket will be reduced by .20 percent. In combination with last year's income tax reductions, the average Minnesotan will benefit from a 15 percent reduction in their income tax liability.
"Minnesota now leads the nation in reducing the tax burden placed on their taxpayers," Paulsen continued. "This is a great accomplishment and it makes the hard working taxpayers the real winners they will be able to keep more of their hard earned money every payday to spend it on the things they need."
The bill also provides for another sales tax rebate of the current state budget surplus. More than $658 million will be refunded to all Minnesotans that had income tax liability in 1998, filed a claim for the 1998 property tax rebate or had social security income in 1998. The average rebate for a married couple filling jointly is $379 and $188 for a single individual. Checks will be mailed out sometime in August.
The license tab fee reduction portion of the tax bill will cut tab fees by $150 million a year. The provision keeps the registration tax the same for the first year of the vehicle's life. However, the license fee is capped at $189 for the second year and will be no more than $99 for the third year and thereafter. Tab fee reductions will be implemented on July 1, 2000.
-30-