Gov. Tim Walz has unveiled his expansive and expensive budget. The impact is crystal clear: Minnesota businesses and all taxpayers would pay billions of dollars in additional taxes to support his budget that totals $90 billion for the next two years, up more than 8% over the existing biennium.

We share the goal of investing in the state’s future. But the governor’s budget proposal is simply unaffordable and will impose additional headwinds to investment by private-sector job-creators.

The state does not lack in revenue. Minnesota has a $1 billion budget surplus, and budget reserves are at $2.4 billion. State spending will increase 4% in the next two years and another 6% in the following two years without changes by the Legislature. The governor’s budget recommends raising spending by 8.4% for the next two years and more than 10% the following two years.

Employers will be asked to pay more than $2 billion to fund this spending — as much as the amount in the state’s rainy day fund.

The governor says Minnesota businesses benefited from the 2017 federal tax reform, justifying his proposal to disproportionately raise business taxes to grow state government. Facts say otherwise. Individual taxpayers received a majority of the federal tax relief, and Minnesota already imposes a high cost of doing business. The federal tax changes capping the deductibility of state and local taxes will make Minnesota’s higher tax rates even more of a competitive concern.

What’s the alternative? A more competitive tax structure that lets employers invest in their companies, employees and communities. Targeted spending that brings a greater sense of value and accountability for public services and programs.

Of all the tax proposals in the governor’s budget, the gas tax has generated the most attention. Investing more in roads and bridges is indeed essential, but a 20-cent, or 70%, increase would make Minnesota’s gas tax the fourth highest in the nation. With this change, we would be adding another tax to our top 10 list of taxes. We would be making one of the more competitive and affordable taxes we pay one of the highest. And, when combined with the other tax increases, the proposal is simply too large and expensive. Instead, we recommend diversifying our revenue streams by tapping transportation-related sales taxes.

If the governor’s budget is passed, we will all be on the hook for more than $8 billion in tax increases for the four-year budget cycle. Of that total, $2.8 billion falls directly on business taxpayers. Business taxes are ultimately passed along, resulting in lower wages and benefits for employees, higher costs for consumers, and lower returns to shareholders.

The governor sounds the theme that we must invest in government to better the lives of Minnesotans. We believe a greater priority is to make sure the state provides an opportunity for growth and innovation through the private sector. The pathway toward economic prosperity requires a balanced approach with selective and strategic investments. Instead of growing government, we should remove government roadblocks to bring efficiencies to government services and work to help ensure affordability for all Minnesotans.

Doug Loon is president of the Minnesota Chamber of Commerce.


(8) comments


JD – “We can afford it, but like the greedy children republicans are, they don't want to share with the rest of us.” Heavy emphasis on share with the rest of us. Spoken like a true Anarchist that switched to Socialism.


ld isn't tone deaf, just simply deaf. Or blind as the case may be...

I am not associated with LSP in any way shape or form. But per usual, ld is too friggin' idiotic to realize and/or notice that I've been here for years and years commenting on articles, since long before he or Teach came along. Long before frac or Daleys.

I support the environment, and sustainable futures, but have no association with the organization.

Ask Hive, he knows I could care less about some other stupid activity or organization to be involved in other than my usual routines...

But I want to get back to Bo. Where are you? What is your response?

Because the way I read it with your tax statement, you have absolutely no concern nor care for people that scrape by with a day to day living, working hard, barely making ends meet, because boohoo, they don't pay taxes but you do?


Nothing could be a bigger rich person disconnect from reality, nor void of empathy for people who are poor, or their age (as noted in post before this in the basement reference) or any other typical hate/prejudice you have in your blackened to the core soul Bo.

lemon drop

Dont know your politics bo but JD is an LSP troll, anyone who argues against him, he name calls. Name call him back, wine, and lots of it.. Our state has a lot to fix, namely "special interest non profits" interesting he names off 2 things LSP, ahhmm "county government" are against.


Tell your dictator president to release them first Bo...

I find your attitude despicable. I'm sure you have no problem with enormous amounts of money yet you whine about paying taxes and others don't?

Tone deaf...


Hive & JD, I would like to see your tax returns before I comment any further.


Greed, greed has entered those chamber bones. More, more they cry as if their special interest is all that matters.


JD is right, we can afford it...question really is, Mr. Loon should have asked, is do we want to, or should we? Like public trans, build it now...we need it now and will for sure in the future. It is not being socialist to look out for our general interests.


"What’s the alternative? A more competitive tax structure that lets employers invest in their companies, employees and communities"

Bullroar. We all know republicans could care less about helping employees and communities so much as lining their pocketbooks.

If we remove government and the programs that make our state so awesome, we will see more of what we've seen here in Winona with frac and Daleys. Businesses trying to move in, exploit resources and people whilst threatening the welfare of said resources and people...

If it means paying more to get more. Do so. Investing in infrastructure, education and health is what this state is about. As is protecting the environment. Not greedy entrepreneurs creating bullroar under the guise of helping, when in fact they'll just pocket the money and move in.

We can afford it, but like the greedy children republicans are, they don't want to share with the rest of us.

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