Archived Story

Deficit Numbers makes tax unecessary

Published 6:18am Monday, March 4, 2013 Updated 8:21am Monday, March 4, 2013

With the state deficit now at only $643 million, Gov. Mark Dayton’s budget that includes a wide array of tax increases is unnecessary.

Dayton has proposed expanding the sales tax to include everything from accounting and legal services to clothing on items over $100. He has also proposed increasing taxes on the wealthiest Minnesotans.

The fact is, compared to the $4 billion deficits the Legislature has had to solve in previous sessions, the $643 million deficit will require only a minor fix. And while it is important that the state pay back its $801 million debt to schools, considering the debt has been in place for several years, it seems only reasonable it take several years to repay it.

Dayton has also proposed to use the extra tax revenue to increase state spending on everything from nursing homes to schools. Such services are clearly valuable.

However, considering the fragile state of the economy, especially with federal spending cuts looming, it seems raising taxes to pay for such spending would cause more harm than good.

If and when Minnesota can get back to the days of state budget surpluses, major reforms might be appropriate.

Until then, however, Dayton and the Legislature should plug the small deficit and leave everything else alone.

  • Walt Henry

    Missing from the Journal’s reporting is a lowering of the general sales tax to 5.5% on many purchases we currently make and a lowering of the property tax burden if a business to business sales tax of some amount is created. I think Dayton’s goal is to make our tax code more progressive, that is more fair, as in those with more pay more and those who currently have little left after taxes will have a little something. (Those who life pay check to paycheck put 100% of their money into the economy, mostly into businesses in their communities and their state. Those who have lots left send the excess to the Caymans, Bahamas or Bermuda–b4 you attack remember where Romney put his greatest assets.)
    Nevertheless, Dayton said yesterday now that the forecast has changed is budget formula and rate of tax increases will change too. (He’s a member of the Democratic Party–not one of those who act like goose-steppers in a shock troop parade.)

  • Walt Henry

    Today’s news–gone is the business to business sales tax (one party listens to the public) but gone also are the $500 property tax cuts on each family owned home and a lowering of the general sales tax to 5.5%.

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