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Associated Press, Published June 20 2012

Minnesota implementing new builder registration

MINNEAPOLIS — The state of Minnesota is scrapping a law that was meant to curb shady employment practices in the construction industry.

The Star Tribune reports http://bit.ly/NeqI27) that next month, the Department of Labor and Industry is phasing in a new registration system for independent construction contractors. At the same time, the Department of Revenue will phase out a four-year-old registration law that contractors largely sidestepped.

The 2008 law was meant to separate legitimate small businesses from workers looking for day labor jobs, and to collect a 2-percent withholding tax from companies that hired independent contractors. But thousands of workers simply registered as limited liability companies instead, and officials say the amount of tax collected was a pittance.

The new system will require contractors to prove they are an actual small business.

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Information from: Star Tribune, http://www.startribune.com


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