If you live in St. Paul or one of these 37 places, look out for additional sales tax hikes
Despite facing an $18 billion budget surplus, the legislature has slapped Minnesotans with about $9 billion in tax hikes in the just-ended legislative session. But unfortunately for residents in some cities and counties, like St. Paul, this is just the beginning.
In the 2023 legislative session, numerous cities and counties applied for state permission to hike their sales tax. And thanks to a compromise between the House and Senate DFL tax committees, 37 of those proposals got the go-ahead that they need.
One of the most notable of those proposals came from St. Paul, which says it needs money for roads and parks. St. Paul asked for a 1 percent sales tax hike, to cost nearly $1 billion over the next 20 years. If approved by voters, the city will have the state’s highest sales tax. Other big cities like Rochester, Bloomington, and Woodbury also asked for sales tax hikes of half a percent. Two cities, Golden Valley, and Mounds View asked for rates over 1 percent.
Table: Sales tax proposals in Minnesota cities and Counties
As we keep saying at American Experiment, Minnesotans are some of the most heavily taxed people in the United States. Thanks to the DFL, those taxes just went up. But if you live in any of these 37 places mentioned above, your taxes might go up even higher. So, look out for ballot questions asking you to approve a local sales tax hike. If you live in the metro region, any sales tax hike proposal on the ballot will be on top of the already passed 1% metro sales tax.
And if you care about fairness, keep in mind that the sales tax is regressive, so these tax hikes will disproportionately burden low-income earners.