Archive for the ‘Taxes’ Category

Dayton Proposes to Raise Taxes; No Spending Cuts

Sunday, February 14th, 2010

Former U. S. Senator Mark Dayton

When former U. S. Senator Mark Dayton announced his intention to run for Governor of Minnesota last month, he proposed to raise taxes on the top 10 percent of income earners, which he claims will bring in an additional $3.8 billion in a two-year biennium. At the same time, he claims, according to this Minneapolis Star Tribune article, that he “whatever I can, whenever I can, wherever I can to bring new jobs to our state.” Maybe someone should tell him that taxing job proviers more is not the way to attract them to our state.

The Truth Detector gives Dayton some credit for his honesty in his complete love of government bureaucracy, as he gives no indication that he would cut or streamline government at all. He only wants to raise taxes and spend more.

Dayton, like many other tax-and-spend advocates, cite the Tax Incidence Study to claim that wealthy Minnesotans pay a smaller percentage of their disposable income in taxes than middle income or lower income folks. This is where the Truth Detector has to give Dayton a “half-truth”, because every time Dayton and his taax-and-spend allies bring this up, they fail to tell the whole story.

Yes it’s true that high income earners pay a smaller percentage of their income in taxes, according to the Tax Incidence Study. This is because the study takes into account regressive taxes (those that fall most heavily on the poor and middle class), such as gas taxes, property taxes, sales taxes and alcohol and tobacco taxes. The income tax (which is very progressive in Minnesota) hits high income earners very hard.

The part of the story that is not told is the part that makes the most sense, if one takes a few seconds to think about it. High income earners pay a smaller percentage on almost everything, when compared to folks who make a more modest income. Think about it! Utility bills, food, clothing, car payments, groceries. It may not seem fair to a lot of people, but high income earners have more money at thier disposal for life’s necessities than middle-or-low income earners. Of course, their tax burden will be a smaller percentage, when factoring in all taxes.

The other part of the story that the tax-and-spend crowd will refuse to tell is that liberals in the Legislature have been effective at raising regressive taxes in recent years, such as the gas tax, and the additional sales tax for the arts and outdoors. These are regressive taxes that are disproportionately paid by low and middle income folks. So they made that tax system in Minnsota more regressive, and now they cry about how unfair it is that the rich aren’t paying their fair share, so let’s sock it to them by raising the income tax!

And politicians like Dayton, who probably never had a private sector job, have virtually no capacity to make government smaller.  Heaven help us if he or one of his ilk become our governor for the next four years.

MN House Meltdown III – the Unconstitutional Tax Increase Bill

Saturday, May 30th, 2009

Here’s a Minnesota House meltdown that didn’t receive much coverage, if any at all from the mainstream media.

Democrats in the Minnesota Legislature are so eager to pass tax increases they are willing to cut corners and ignore the constitution to push them through. Consider the path of House File 885, one of several major tax increases that Legislative Democrats passed and fell to the floor with a thump once they landed in Governor Tim Pawlenty’s office.

HF 885 started out as the “Tax Omnibus Technical Bill”. It contained benign, technical tax policy that was largely non-controversial. On May 7th, the House passed it off the floor on a bipartisan vote of  120-11. The Senate Received the bill and promptly loaded it up with one of the highest income tax rates in the nation, the highest alcohol tax in the nation and egregious tobacco tax increases. The Senate also added a surcharge on credit card issuers (aka banks) that charge interest on credit cards. This version of the bill passed the Senate 43-23, also on May 7th. A conference committee was hastily named to work out the differences between the House version and the Senate version of the bill, and of course the bill came back to the House on May 8th looking more like the Senate version, loaded up with the plethora of tax increases.

HF 885 was debated at length on the House floor on May 8th, and on a vote of 86-45 was re-passed, or so Speaker Margaret Anderson Kelliher ruled. Immediately upon the Speakers pronouncement that the bill had been re-passed, Rep. Mark Buesgens (R – Jordan) raised a point of order, stating that the Speaker’s ruling was incorrect and that the bill had actually failed. The basis for Rep. Buesgens’ point of order is a little known provision in the Minnesota Constitution. Article IV section 26 says “Passage of a general banking law requires the vote of two-thirds of the members of each house of the legislature.” This means the vote on HF 885 fell four short of the required 90 votes needed for passage.

Speaker Kelliher and the DFL leadership did not see this one coming. First the Speaker said she does not have the authority to rule on the constitutionality of a bill. Rep. Buesgens explained that he is not challenging the constitutionality of the bill, he was raising the point that she had ruled in error when she declared the bill to be re-passed. At that point, a flustered Speaker and and equally flustered DFL House Majority Leader Tony Sertich began stalling for time so they could consult with partisan and nonpartisan staff.

After a period of awkward silence, Sertich moved to set the time of adjournment for the next day, something usually done at the end of the day’s business just prior to the actual motion to adjourn. Several minutes elapsed between the Speaker counting the “ayes” and the “nays” on this standing vote. After several minutes of more awkward silence while DFL leadership continued to consult with staff Sertich moved to “continue the calendar” meaning he wanted to move on to the next item of business.

In the end, the Speaker refused to rule on Rep. Buesgens’ point of order and declared the bill to be re-passed. The Senate re-passed the bill on May 8th, 44-20. Fortunately for the integrity of the Constitution, and for the sake of the taxpayers of Minnesota, Governor Pawlenty vetoed HF 885 in its entirety on May 9th.

The entire meltdown can be seen on the Minnesota House of Representatives video archives. Go to this page on the Minnesota House website and scroll down to Friday May 8 2009 House Floor Session part 3 and click on “Watch this program”. After the video starts slide the bar to 04:51:05 to enjoy the show. The entire length of the meltdown lasts about 21 minutes.

This is the bill that House Democrats brought up for a veto override on May 17th, but on a vote of 85-49, came five votes short of the 90 votes required to override the Governor (two Democrats, Reps. Pelowski and Poppe, joined all 47 Republicans voting against the override).

In the interest of full disclosure, I am an employee of the Minnesota House of Representatives for the Republican Caucus. Tihs blog is not paid for nor sponsored in any way by any legislative caucus, candidate, candidate’s committee or political party. Opinions expressed herein are solely those of the administrator of this website and not necessarily those of any legislative caucus, candidate, candidate’s committee or political party.

Not Enough Space to Tell us of All the Tax Increases

Sunday, May 10th, 2009

 

Rep. Tim Faust (DFL - No Man's Land)
Rep. Tim Faust (DFL – No Man’s Land)

The commentary in the Kanabec County Times by Rep. Tim Faust (DFL – No Man’s Land) was his attempt to justify is vote for the enormous tax increase passed by the Minnesota House of Representatives a couple weeks ago. Unfortunately, his commentary is barely a blip on the truth detection meter. Faust mentioned the “4th tier”, a new tax bracket with a higher rate that successful income earners and job providers would have to pay. He also mentioned a “slight increase” in tobacco and alcohol taxes that were in the bill. The truth detection meter registers this comment as  “horse hockey”, unless you consider a doubling of the gross receipts tax on alcohol, a doubling of the tax on a barrel of 3.2 beer and a 75 percent increase of a barrel of strong beer a “slight increase”.

As for the other tax increases in the bill he didn’t mention I can only surmise that there wasn’t enough column space to mention them all. Rep. Faust didn’t tell us that itemized deductions such as the mortgage deduction,the property tax deduction and deductions for charitable giving would go away if this bill becomes law. This bill also takes away the $25 tax credit for low income earners that was put into place just last year when the gas tax increase that Rep. Faust supported was passed.

Remember the sportsmen that worked so hard to get the Legacy Amendment for the outdoors passed? Rep. Faust didn’t. He voted to penalize them by taking away the sales tax exemption on the sale of used boats, snowmobiles and ATVs.

Even your teen or pre-teen is not immune to Rep. Faust’s tax increases, as iTune and other digital downloads would be taxed under the bill that he supported.

One of the most troubling provisions in the tax bill four our area is the repeal of the Job Opportunity and Building Zones (JOBZ) program. JOBZ has been an important job creation tool in Pine City, North Branch, Wyoming and many other communities in Greater Minnesota. To be clear, the bill doesn’t just call for an end to the program from this point forward. It calls for the state going back on its word to employers who are already in the program by repealing their income tax incentives for job creation.

Due to lack of space, Rep. Faust failed to give us the “rest of the story”. Or maybe it’s just due to him not wanting his constituents to know. Either way, the Truth Detector says, “Horse Hockey”.

In the interest of full disclosure, I am an employee of the Minnesota House of Representatives in the Republican Caucus. This blog is not paid for or sponsored in any way by any legislative caucus, political party, candidate or candidate’s committee. Opinions expressed herein are those of the administrator of this website and not necessarily that of any legislative caucus, political party, candidate or candidate’s committee.

Rep. Tim Faust (DFL – No Man’s Land) – What’s He Done for Jobs?

Sunday, May 3rd, 2009

 

 Rep. Tim Faust (DFL - No Man's Land)

Rep. Tim Faust (DFL - No Man's Land)

In his quest to get elected to the Minnesota House of Representatives, Tim Faust the candidate leveled many criticisms at his predecessor and opponent, Judy Soderstrom. One of the things he said publicly and repeatedly is that Rep. Soderstrom had not done enough to bring jobs to the area. He stated many times that it should be a state representative’s job to recruit businesses and bring jobs to the area.

Now that Rep. Faust has been in office nearly 2 1/2 years, I think it’s fair to ask what his track record on local jobs is. Can he point to one single new job that he has personally been responsible for? What businesses has he recruited to locate in our area? Although I haven’t looked at any specific stats, I think it’s also fair to point out that the job situation in House District 8B is much more dire than when Rep. Faust took office.

After watching a tape of the April 3, 2009 House Tax Committee hearing, it appears that Rep. Faust is doing the opposite of his stated intent as a candidate. In presenting a bill to the committee, he must have thought it was a good idea to run down his district in order to improve the chances of his bill getting included in the omnibus tax bill.

His bill would allow the economic development region in East Central Minnesota to grant tax increment financing (TIF) to tourism facilities.

In presenting the merits of his bill, Rep Faust talked about how his district is among the worst in the state for unemployment. He then explained that his bill is needed because his district is not really metro, and not benefiting from economic development going on in the suburbs. “We’re kind of in no man’s land,” he stated.

Just as an aside, Pine City city administrator Don Howard was on hand to testify in favor of Faust’s bill. In stark contrast to Faust’s depiction of the district, Howard talked about the natural resources and the fact that people flock to the region in the summer time.

Since this is the East Central Truth Detector, I will say here that Faust’s bill, if it becomes law, will be a good tool for cities in our area to use to attract businesses. Rep. Faust’s bill was included in the House Omnibus Tax Bill. Unfortunately, the Omnibus Tax Bill has $1.9 billion worth of tax increases, and includes elimination of the JOBZ tax incentives.  The Tax conference committee is meeting to negotiate the differences with the Senate’s $2.2 billion worth of tax increases. The final product is certain to meet its end with Governor Pawlenty’s veto pen.

My point here is that a state representative shouldn’t, and doesn’t need to, run down the area he represents in an effort to get a bill passed. Especially when, as a candidate, he promised to promote the area and recruit employers.

In the interest of full disclosure, I am an employee of the Minnesota House of Representatives in the Republican Caucus. This website is not paid for or sponsored in any way by any legislative caucus, political party, candidate or candidate’s committee. Opinions expressed herein are those of the administrator of this website and not necessarily that of any legislative caucus, political party, candidate or candidate’s committee.