Good things are happening on the Minnesota economic front. Unemployment is dropping. The state treasury has a projected sizable surplus. Our state is outperforming the national economy in many regards. We want to make sure the momentum continues. The Minnesota Chamber and our local chamber partners are ready to advance another aggressive agenda at the 2015 Legislature. Tax relief headlines our priorities. Minnesota is a great place to live and work, but our taxes on all businesses – small, medium and large – rank among the highest in the nation. And businesses do take notice. In the 2014 Minnesota Business Barometer Survey, 62 percent of the respondents said high taxes in Minnesota were one of the top barriers for job creation. Learn more about the MN Chamber’s top five priorities:
The concerns are not surprising, given the record tax increases and spending enacted by the 2013 Legislature including a new fourth-tier rate in the personal income tax. Though many characterize this as a “tax on the rich,” it really is a tax on those businesses that pay their taxes through the individual income tax. Ninety-two percent of Minnesota businesses, including our smallest and newest, do so.
We propose that business owners who report income from their business on their personal income tax return be allowed to deduct a certain portion of this income from their taxes. This will encourage businesses to reinvest in their companies and employees and improve their competitiveness.
Rounding out our top five priorities:
Workforce: Accelerate our workforce development efforts to help employers struggling to find skilled workers. The urgency for skilled workers is greater than ever and spans all industries and all parts of our state. We must especially ensure that our K-12 graduates are ready for higher education and work when they get their diploma. Many jobs are available to them after high school if they have mastered our state’s K-12 curriculum.
Health care: Ensure small employers are able to provide affordable and quality health care coverage for their workers. More than half of those surveyed in our Business Barometer who provide health insurance for employees said their costs are increasing. We will seek policy changes that reduce those increases. We also will advance common-sense reforms to improve the operations of MNsure, the state health insurance exchange.
Transportation: Maintain a solid transportation system by passing a 10-year funding plan that provides for sustained and strategic investment in roads, bridges and transit. Minnesota businesses believe that today’s system meets their most pressing needs. However, without additional funding, investment in our roads and bridges is projected to drop significantly, beginning in 2016. We support a three-pronged approach to broaden and increase permanent funding: identify efficiencies; use a portion of the general fund; and use value-capture mechanisms, similar to tax-increment financing, to assign a portion of a project’s cost to those who most directly benefit.
Labor/management: Eliminate the automatic inflation index in the state’s minimum wage rate, and reduce employer costs by advancing workers’ compensation reforms in the hospital fee schedule for treatment of injured workers as we continue our efforts on regulatory reform. Seventy-two percent of the respondents in the Business Barometer said government doesn’t do a good job of balancing the proper amount of regulation with the need of businesses to keep growing.
Minnesota returns to divided government following the November elections, but our goals remains the same. We look forward to working with Governor Dayton, the Senate, and the new pro-business majority in the House to deliver policies that will keep our state’s economy changing and growing.
Bill Blazar is interim president of the Minnesota Chamber of Commerce: www.mnchamber.com.