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Legislative News and Views - Rep. Shane Mekeland (R)

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Legislative update

Friday, June 30, 2023
Independence Day 4

Dear Neighbor,

Best wishes for a happy Independence Day! Let us remember all the past heroes who fought for our freedom and unity this holiday as our great nation celebrates its independence. Let us come together to make America an even better place for tomorrow, mindful of everything we can do to keep the United States of America strong so that prosperity may endure for future generations to enjoy.

As for legislative news, a whole host of new laws are set to take effect in Minnesota on July 1, coinciding with the start of the new fiscal year. The 2023 legislative session ended in late May with the DFL trifecta putting into law nearly $10 billion in tax increases.

Of that total, Minnesotans are set to face $3.8 billion in transportation tax hikes alone. Some of these tax increases are set to take effect as of July 1. Here are some of the new transportation-related expenses to note:

  • Vehicle registration tax/tabs: This tax hike averages to be a 36% increase over the first 11 years of your new vehicle. The change will apply to taxes payable for a registration period starting on or after January 1, 2024.
  • Filing fee increases: Filing fees will increase to $8 on every vehicle registration renewal, excluding pro rate transactions. This section is effective October 1, 2023.
  • 50-cent delivery fee on retail deliveries over $100: Over $189 million over four years is expected to be leveled on residents who shop from home thanks to this tax. The fee will be implemented on deliveries over $100. Exemptions include deliveries for groceries, prepared food, baby products, and feminine hygiene products. The tax would begin on July 1, 2024, and is the largest delivery tax in the U.S.
  • $6 Fee increase for driver licenses: This is effective July 1, 2023, and applies to applications made on or after that date.
  • Gas tax – automatic increases for inflation: The expected gas tax hike beginning January 1, 2024 is 5 cents over four years. Drivers will pay $423 million over four years for this Democrat priority.
  • Metro sales tax changes: This 0.75% increase in the 7 county Metro Sales Tax for Transportation will see 83% of funds go toward Metro Transit funding and 17% will be sent to Metro Counties for local road projects. This section is effective for sales and purchases made on or after October 1, 2023, and applies in the counties of Anoka, Carver, Dakota, Hennepin, Ramsey, Scott, and Washington.
  • Increase in motor vehicle sales tax from 6.5% to 6.875%: Will give Minnesota the 5th highest Vehicle sales tax rate in the U.S. This section is effective for sales and purchases made on or after July 1, 2023.

These transportation tax hikes were unnecessary and add to the burden Minnesota families already face with higher costs on pretty much everything in today’s economy. Democrats did not need to raise taxes when we had a record surplus and it is disappointing more wasn’t done to provide relief for Minnesotans instead of adding to their challenges.

Energy spending

Democrats also passed legislation that will make our state’s energy grid more unreliable, unaffordable and dangerous. Our focus should be on delivering affordable, reliable energy on a stable grid for Minnesotans but, instead, DFL legislators are spending tax dollars on pet projects that are not helpful to that mission. Finance provisions which take effect July 1 include:

  • $38.7 million for weatherization and pre-weatherization work
  • $16.1 million for the Solar for Schools program
  • $6 million for electric school bus grants
  • $6 million for a heat pump rebate program

For the 2024-25 biennium, $72.7 million from the Renewable Development Account will go to the Department of Commerce for numerous projects, including:

  • $14.3 million for the Solar for Schools program
  • $10.7 million for an electric vehicle rebate program
  • $10.2 million for distributed energy resource system upgrades
  • $7.5 million for grants to the University of St. Thomas Center for Microgrid Research
  • $7 million for electric school bus grants

Click here for more details on all the laws that take effect July 1.

Until next time, hope you are having a good summer and please stay in touch.