Minnesota Business Owners See Tax Hike as Lawmakers Fail to Come to Legislative Agreement


Businesses across Minnesota are expected to see an increase in their unemployment insurance taxes after lawmakers failed to come to an agreement on the issue before the automatic tax hike went into effect.

During the coronavirus pandemic, the state’s unemployment insurance trust fund was depleted, and the tax hike will go to replace the funds and repay the federal government for unemployment aid.

Governor Tim Walz and Senate Republicans offered similar, bipartisan solutions to the issue amid the state’s historic budget surplus. However, Democratic leaders in the House have refused to advance the legislation.

Republican Party of Minnesota Chairman David Hann blamed Democrats for “political games” as the deadline approached.

“Democrats in the Minnesota Legislature also pushed a gimmicky gas tax holiday after they and Walz tried to raise the gas tax by more than 25 cents per gallon since he first took office. Meanwhile, legislative Democrats are threatening businesses with a massive tax hike at a time when Minnesota has a $9.3 billion surplus,” he said

“The hypocrisy is stunning. Meanwhile, House DFLers are holding workers and businesses hostage with a potential massive tax increase on unemployment insurance – while hanging on to a historic surplus of more than $9 billion. It’s time for Governor Walz and the Democrats in the legislature to act and provide real, meaningful relief that Minnesota’s workers and businesses need.”

Furthermore, the increase in taxes led Montana Governor Greg Gianforte to invite businesses to relocate to the state due to fewer restrictions.

“As a business leader and entrepreneur, I understand it’s critical for the success of your business to have tax and regulatory stability and certainty, which allows you to thrive, create jobs, and increase opportunities. Anything less than certainty and stability is bad for business,” the governor wrote in an open letter to Minnesota small business owners,” he wrote in an open letter.

“I write to offer you greater tax and regulatory certainty as well as a business-friendly climate in Montana.”

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Cooper Moran is a reporter for The Minnesota Sun and The Star News Network. Email tips to [email protected]

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