ST. PAUL – In the face of a $17.5 billion budget surplus, House Democrats continued their financial attacks on Minnesotans Thursday by approving their comprehensive taxes proposal which includes additional tax increases of $2.2 billion. State Representative Paul Torkelson (R-Hanska) said the proposal will also have major negative implications locally, as Democrats seek to eliminate the popular electronic pull tabs as we know them.
“It’s bad enough that the House majority has used the taxes bill to implement even more tax increases rather than providing more Minnesotans with needed tax relief,” Torkelson said. “But now, they are targeting electronic pull tabs, which means they are also targeting the local charities and sports organizations who benefit from charitable gaming.”
Torkelson said specific language would eliminate the “open all” feature that has been in use in electronic pull-tab games for years and is expected to drastically alter the amount of sales – and ultimately charitable revenue – that is collected. Almost $2 billion in revenue was generated in 2022 alone from electronic pull tabs, and a significant decline in sales will impact the charitable gaming revenue that is available for distribution to local nonprofits, youth sports associations, and other charities.
Torkelson said the House taxes proposal would raise taxes by $2.2 billion by creating a 5th income tax tier and forcing corporations to claim all worldwide income on their Minnesota returns.
But Torkelson added that bill represents only a portion of the tax increases House Democrats want to put into law this year. There’s also $3.5 billion in transportation tax increases, which would raise the costs of license tab renewals and the Motor Vehicle Sales Tax, increase the sales tax in the Metro Area, and implement a 75-cent delivery tax on items that are dropped off at your front door.
Every Minnesota worker and employer would face higher taxes to fund a new state-run insurance program that covers paid family and medical leave. A separate sales tax increase in the Metro Area would also be implemented in order to fund housing programs.
In all, Torkelson said the proposed Democrat tax increases would total nearly $10 billion even though the State of Minnesota sits on a $17.5 billion budget surplus.