Senate approves tax $100M relief for individuals, small businesses

The Minnesota Senate passed a tax conformity bill last week, bringing Minnesota in line with recent federal tax changes and cutting tax collections by more than $100 million.
The bill passed with bipartisan support and Governor Walz signed the bill into law on Thursday.
“The Senate’s tax conformity bill is an important, bipartisan achievement that will bring much-needed relief to many taxpayers,” said Senator Gary Dahms (R-Redwood Falls). “Minnesota ranks as one of the most heavily taxed states in the nation, and lowering our taxes is essential to ensuring we are competitive. With the state’s historic surplus, we have an even greater opportunity to enact permanent tax relief.”
The bill aligns Minnesota tax code with Federal tax adjustments that resulted in many tax changes.
Those included: The Coronavirus Aid, Relief, and Economic Security (CARES) Act from 2020, The American Rescue Plan (ARPA) Act from 2021, and The Inflation Reduction Act (IRA) from 2022.
Notable provisions in the bill include:
• Temporarily increasing the limit on charitable contributions
• Allowing for student loan payments by employers
• Increasing the amount a business can provide for employee child care benefits.
Missing from the bill is the elimination of the tax on Social Security or any reduction in personal income taxes. Senate Republicans attempted to amend these changes to the bill, but Democrats opposed the moves through parliamentary procedures.