Minnesota tax revenue 10 percent higher than forecast
To say that the Minnesota’s government is awash with cash would be an understatement. After finishing the 2021 fiscal year with a $2.67 billion surplus, Minnesota is already surpassing its February forecast in tax collection for the 2022 fiscal year.
According to Minnesota Management and Budget, in October, the Department of Revenue collected $87 million –– 4.5 percent –– more than was forecasted in February. Additionally, “for fiscal year 2022, year to date receipts are now $7.968 billion, $744 million (10.3 percent) more than forecast.”
Certainly, month-to-month collections can have wide variations, but tax revenues have exceeded expectations for each of four months of the Fiscal year 2022 by at least four percent. So to say the least, the Department of Revenue is off to a great start.
This also means the Minnesota Legislature has much more leeway to consider tax relief, as a lot of states have done during the pandemic. Minnesotans, including low-income ones, are some of the most heavily taxed individuals in the nation. Increasing tax revenues generally provide a way for legislators to cut taxes without jeopardizing the provision of services.
In our case, our high and increasing levels of spending coupled with high revenues are a signal that there is more than enough room to provide tax relief.