With inflation punching everyone in the groin, taxes tend to be a lesser-discussed topic (or complaint) for many of us right now. However they’re just as important and they can be a major detriment to people’s finances. So how high or low are they here in Minnesota?
Here’s Five Fast Facts About Minnesota’s Tax Rates:
- 📈 High? - Looking at the numbers, Minnesota has the sixth highest income tax rate in the country. That’s technically true, but it’s only for the highest bracket. It’s a graduated rate tax that starts at 5.35% for lower-income residents and increases to 9.85% for the wealthy residents.
- 🪜 Corporate Ladder - Our corporate tax rates are the second highest in the country. It led the state’s Chamber of Commerce to call it “a burden to economic growth.” Our record unemployment and consistent job growth says otherwise on that front.
- 📊 Totals - Our state and local taxes made up 12% of the state’s total income in 2021. That includes income taxes, local and state property taxes, sales taxes, business taxes, and even stuff like cigarette and gas taxes. By way of comparison, North Dakota uses 7.9%.
- 🗺️ Prosperity - Some pundits argue that the higher tax rates are why the state is so prosperous compared to the states that surround us. Not sure how taxing ourselves INTO prosperity works but it's one perspective…
- ⛰️ Surplus - It should be noted that the state just reported the budget surplus has now hit $3.7B. Maybe we are getting taxed too much.
🔥Bottom line: There’s a lot going on with our tax dollars, and it puts our state in a unique position. Where the money goes and who pays what is certainly complicated, but there’s a very strong argument about what should be done with that surplus and when it should be done.
What do you think of our tax structure?
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