From the internet
The documents and the statistics have spoken and they say that Minnesota’s income tax system is among the most progressive in the nation.
The study that was released from the Minnesota center for Fiscal Excellence states that the income tax system is a national leader in addressing the issues taxpayers have with their ability to pay. Although many of the higher income taxpayers in Minnesota pays some of the highest taxes in the countries, the lower income families have the lowest income tax burdens.
This is a report that is designed to help determine who is paying their fair share of taxes, especially since Minnesota lawmakers are considering imposing even higher tax rates for some of the top earners in the state.
Typically, “fairness’ is a politically convenient term that is used when there is the desire to raise more tax revenue. However, it has been cited that there is a need to go into such increases with eyes wide open in order to ensure other things do not suffer. There are three areas being considered and they are stability, accountability, and competitiveness. The fear is that a lot of revenue would be lost when the higher earners would leave the state. That would affect stability and competitiveness. The accountability aspect is ensuring that taxpayers are not insulated from their responsibility of paying their taxes.
Also covered in the study is the impact that income tax has on seniors in the state. Those with household incomes that exceed $75,000 pay some of the highest income taxes among retirees in the U.S. and much more than seniors in surrounding states. This is because Minnesota doesn’t give seniors special treatment. It is recognized that there is some risk in this arena since seniors tend to be more mobile in regards to moving out of the state to save money.
Nonetheless, the state tends to be under-appreciated for its addressing of ability-to-pay issues. There is also the state’s generosity in its property tax refund program.
This study compared Minnesota with the District of Columbia and 41 other states. The other 9 states in the union either have no state income tax or they have that is limited to the point that it wasn’t feasible to analyze. Overall, the study gives Minnesota an idea of how it stacks up against other states, which is important when considering tax increases since such increases can influence whether or not some of the higher earners stay within the state.