The Minnesota House of Representatives approved Wednesday morning Special Session House File 1 on a bipartisan vote of 102-31. Under the bill, Minnesotans will see more than $650 million in tax relief over the next two years, the largest tax cut in nearly two decades.
“We have worked very hard with the Governor’s Office to find common ground and I believe this is a proposal he will sign, which is very good news for senior citizens, college students, farmers, small business owners and middle-class families,” said House Tax Chair Greg Davids (R-Preston).
“For years we have heard from farmers and Main Street business owners who were struggling with unbelievable property tax obligations, asking lawmakers for help,” said State Representative Steve Drazkowski (R-Mazeppa), chairman of the Minnesota House Property Tax and Local Government Finance Division. “Their long overdue relief is just a signature away from becoming reality.”
Highlights of the bill include:
$117 million in relief for Minnesota’s senior citizens. Under this bill, nearly 284,000 senior citizen tax returns (single and married filing jointly) would receive tax reductions; 72,000 of those would no longer pay state income tax on their benefits.
Nearly $55 million to address college affordability through a first-in-the-nation tax credit for student loan payments, along with $20 million in subtractions and credits for families saving for college using 529 Savings Plans.
$34 million in relief for farmers by reducing the burden farmers and agriculture land owners pay for school bond referendums. Approximately 240,000 farmers could receive property tax relief to reduce their disproportionate share of school district debt service.
$36 million for families with young children by modifying the child and dependent care credit.
$95 million in relief for hometown businesses by exempting the first $100,000 in property value from the extra tax on businesses and freezing its automatic inflator.
$15 million each year for Local Government Aid and $25.5 million per year for County Program Aid.
Now passed by the House, Special Session HF1 is expected to pass the Senate and will go to the governor’s desk for a signature. The bill is part of a Special Session agreement struck by House and Senate leaders and Governor Dayton to finish the 2018-2019 biennium budget.