| For Immediate Release | For more information contact: |
| March 1, 1999 | Lindsay Sander (651) 297-5600 |
St. Paul Rep. George Cassell, R-Alexandria, recently had an important bill for Minnesota business owners heard by the tax committee. The bill, House File 355, will repeal a requirement that certain businesses in the state make an accelerated sales tax payment to the state by the end of June each year.
"Currently businesses are faced with an unfair economic burden because the tax code forces them to make this early payment," Cassell said. "While this might have been justified in the 80s when the state was experiencing budget deficits, the state is currently enjoys significant budget surpluses. We need to correct this now, while we can."
Minnesota has a constitutional amendment that requires a balanced budget. In July of 1981 the state enacted a procedure that shifted some tax liability payments as a temporary solution to a state budget shortfall. By collecting the taxes early, the state gains approximately $150 million to balance the budget. The current law requires any business with more than $120,000 of sales and use, liquor or tobacco taxes must make an early payment of their June tax liability.
"Another problem with this practice is that the state penalizes businesses if they estimate their sales tax wrong. If a business underpays what they actually owe, the business faces more fines and penalties. Last year, businesses paid more than $600,000 in fines."
This practice does effect businesses in District 10-B as well as throughout the state. It is unfair to these businesses to carry this extra burdan when it is no longer necessary. The state has had six years of revenue surpluses and Cassell says now is the time that this be changed.
Rep. George Cassell represents District 10B which includes the Alexandria area. He can be contacted at (651) 296-4317 or you can write him at 421 State Office Building, 100 Constitution Avenue, St. Paul, MN 55155 or e-mail rep.george.cassell@house.leg.state.mn.us
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