Wednesday, April 24, 2013

A Better Minnesota Update

Here they come:
Senate DFLers are breaking from the governor’s tax plan and pushing for an income-tax increase that would reach down into what many consider middle class.

The comprehensive $1.8 billion tax overhaul plan released Tuesday would tap married filers’ taxable income above $140,000 a year. The DFL-controlled Senate also is seeking a dramatic increase in tobacco taxes and the first sales tax on clothing. To offset the sales-tax expansion, the Senate would lower the overall sales-tax rate to 6 percent from 6.875 percent.
The Star Tribune provides a handy synopsis of all the changes:

• Top income-tax rates, to 9.4 percent from 7.85 for net income above $140,000 (married) or $80,000 (single).
• Tobacco taxes to 94 cents per pack.
• Overall sales-tax rate to 6 percent from 6.875.
• Sales tax on clothing for the first time.
• Sports memorabilia, including jerseys, would be taxed 13 percent at wholesale level.
If this plan goes through, I'd imagine you'd see a whole lot of new Vikings gear on sale in Hudson. It has long been a competitive advantage for clothing retailers that Minnesota didn't charge sales tax on clothing. If it begins to do so now, even at an effective rate of 6%, it would be more than Wisconsin's rate of 5%.
This Better Minnesota is gettin' expensive.

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