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MINNESOTA TRIES TO OUT-STUPID IOWA
April 02, 2007
The Iowa General Assembly has been setting a standard for bad legislation, passing out special tax breaks at a furious pace.
Minnesota's legislature couldn't keep up with Iowa's production of stupid little tax bills, so they decided to retaliate with one great stupid tax bill: their senate voted to give Minnesota the highest state tax rate in the nation.
Saturday’s vote capped the first half of the session, as Democrats tested the limits of their legislative power in the face of Pawlenty’s veto threats. The tax proposal would raise almost $1 billion by creating a new fourth-tier income tax rate of 9.7 percent. The rate would hit taxable income above $250,000 for joint filers and $141,250 for single filers.
Minnesota’s top rate is currently 7.85 percent. Only California, Vermont and Oregon have top rates of 9 percent or more.
Fortunately for Minnesotans, the bill faces a veto. And while 9.7 would be the highest "stated" rate, California has a 1% surtax that would have kept it on "top" in real terms.
The TaxProf Blog and Taxable Talk have more.
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