Minnesota House of Representatives
Republican Caucus

(St. Paul, MN...) The Republican Lunch Bucket Tax Cut, a comprehensive tax package which will send $1.35 billion back into the hands of working Minnesota families in the current biennium, and $1.6 billion in the 2002-03 biennium, was heard in the House Tax Committee today..

The plan includes another permanent income tax cut weighted toward the middle income bracket, deeper cuts in property taxes for farmers and businesses, and a new health insurance premium deduction. Republicans also included in the bill another one-time sales tax rebate of $500 million using the surplus money that is already in the bank.

"The Lunch Bucket Tax Cut of 2000 will directly benefit the working Minnesota families that make up the middle class," said Sviggum. "If you get up every day and pack a lunch for you and your family in a lunch bucket or brown paper bag, and eat that lunch on the run at your work site in twenty minutes, this tax cut is for you."

The centerpiece of the Lunch Bucket Tax Cut is a « percent cut for both the top and bottom income brackets and a 3/4 percent cut for middle class taxpayers. Since most of the budget surplus continues to come from over-collection of the income tax, Republican leaders believe a permanent cut in income taxes will prevent future surpluses from accumulating.

"Even after passing the largest tax cut in Minnesota history last year, income tax revenue continues to come in faster than we can spend it," said Rep. Abrams. "This is a responsible tax cut that keeps the money in the family budget instead of building up in another government surplus."

- more -The Lunch Bucket Tax Cut of 2000 includes:

Permanent cuts in income tax rates: Current Law Lunch Bucket Tax Cut

8% 7.5%

7.25% 6.5%

5.5% 5.0%

Another sales tax rebate totaling $500 million, giving the average taxpayer a $250 check in the mail after the 2000 session.

Further property tax reform including additional reductions for agricultural land and further rate compression for commercial/industrial and apartment property.

A new health insurance premium tax deduction which will allow taxpayers to claim a deduction for all of their health insurance premiums.

Corporate franchise tax reductions for businesses which will make them more competitive with other states and promote job creation in Minnesota.

"The Lunch Bucket Tax Cut is a comprehensive, balanced approach that will bring much needed tax relief to middle class Minnesota families," added Majority Leader Pawlenty.

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