Slides for regional policy meetings 5-10

THE VOICE OF BUSINESS

Regional Policy MeetingThe time is NOW!

• Introductions• What are your

priorities? • Higher Ed and

Workforce Needs • Tax Reform: Initial

thoughts• Wrap-up


Your Policy Priorities

• What can we work on to make Minnesota’s business climate more competitive?


Higher Education and Workforce

• New hires and applicants

• Current workforce

• Coming trends in your industry


Tax Reform

• It’s coming.

• Governor Dayton’s focus: stability, more revenue.

• The Minnesota Chamber’s focus: competitiveness Revenue Commissioner Myron Frans

Photo: Howard Lestrud, ECM Publishers


Why Reform?

• Globalization• Economy• Demographics• Innovation/

Technology• Minnesota

Competitiveness


Why Reform?

“Our recommendations…will transform MN into a global engine of economic growth and job creation….The sooner MN moves to gain the global competitive edge, the more quickly all Minnesotans can reap the benefits of job growth and economic expansion.”

Governor’s 21st Century Tax Reform Commission


A Starting Point…• Expand the sales tax

base to include more consumer-purchased goods and services

• Decrease the sales tax rate

• Decrease or eliminate some business taxes

• End result = revenue neutral


Tax Reform Scenario - Assumes $2.1 Billion in Sales Tax Base Expansion

FY 2014

Sales tax base expansion at 6.5% $2,100,000

Repeal state property tax ($820,000)

20% exemption for pass through income ~($150,000)

Capital equipment up front exemption ($92,000)

Exempt technology inputs from sales tax ~($200,000)

Reduce corporate income tax rate to 7.0% ($250,000)

Sales tax rate cut to 6.0% ($534,000)

Low income tax credit ($50,000)

Total $4


Option #1: Broad ConsumerSales Tax Base Expansion (~$2.1B)

Food Fem. Hygiene Prod Tickets to MN Zoo Funeral services

Clothing Caskets & Vaults YM/WCA & JCC Other pers. service

Prescription Drugs Publications Inst. Meals Inv. counseling

OTC Drugs Textbooks Fundraising sales Brokerage fees

Medical Devices Res. Heating Fuels Artistic events Car repair

Eyeglasses Res. Water Service School events HH goods repair

Baby Products Sewer Service Pers. care services Elec. equip. repair


Option #2: ModerateSales Tax Base Expansion (~$1.4B)

Food @ 3% Fem. Hygiene Prod Tickets to MN Zoo Funeral services

Clothing Caskets & Vaults YM/WCA & JCC Other pers. service

Prescription Drugs Publications Inst. Meals Inv. counseling

OTC Drugs Textbooks Fundraising sales Brokerage fees

Medical Devices Res. Heating Fuels Artistic events Car repair

Eyeglasses Res. Water Service School events HH goods repair

Baby Products Sewer Service Pers. care services Elec. equip. repair


What do you think? • Willing to support

expansion of the sales tax base to get lower rate, business tax cuts and more stable tax revenues?

• Which business taxes to target? – Property tax (state or local)– Income tax (personal or

corporate)– Sales tax


Thank You!

• Questions?

• Join the Minnesota Chamber and the Small Business Policy Committee! ??’’ss