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Don Davis, Forum News Service, Published January 29 2013

Minnesota notebook: GOP raises its concerns about Dayton tax plan

ST. PAUL – Republicans are ramping up their complaints about Democratic Gov. Mark Dayton’s tax plan.

During legislative meetings Tuesday, they especially questioned Dayton’s proposal to send a $500 property tax refund to most homeowners.

“We can guarantee people a tax increase, but can’t guarantee them tax relief,” Sen. Dave Thompson, R-Lakeville, told Revenue Commissioner Myron Frans.

Dayton’s plan would raise taxes on the richest 2 percent of Minnesotans and add sales tax to some services and goods now not taxed, while lowering the overall sales tax rate.

“We are raising taxes at the state level in a big way ...” Thompson said. “The tradeoff is the $500 check going back to property owners.”

Sen. Julianne Ortman, R-Chanhassen, said the Dayton plan looks like a “re-election ploy.”

“I cannot figure out why we would take money out of the pockets of middle income and poor Minnesotans just to write a check to homeowners,” she said.

Frans said that during a tour of the state in recent months, Minnesotans told him they were most concerned about rising property taxes. The $500 tax refund was the best Dayton could do now, he added, because there is not enough money available to institute a full property tax overhaul.

How big an increase?

The Dayton administration and fellow Democrats use the figure of $2 billion when discussing tax increases in the governor’s proposed budget.

Republicans say it is more.

The latest figures from the administration indicate that new taxes would raise $3.6 billion in the next two years. Republicans say that grows to $3.7 billion after fee increases and a proposed Twin Cities transportation tax are added. When $1.5 billion is sent to homeowners in property tax refunds, that leaves a $2.2 billion net tax increase.

Unions fight lockouts

Provisions making it less attractive for companies to lock out workers during labor disputes is high on the Minnesota AFL-CIO legislative agenda.

The labor organization announced its agenda Tuesday, including what it calls the “Employer Lockout Accountability Act.”

The proposal would require unemployment benefits be provided to workers for a lockout’s duration. The AFL-CIO plan also would add a penalty to an employer’s unemployment tax bill if it locks out employees.

Also on its agenda is increasing the state minimum wage. The wage increase would be followed by automatic increases in the future pegged to inflation.