A new 1% sales tax just took effect in the Twin Cities metro area. The revenue is earmarked for some necessary public improvements and programs, but how exactly does that break down?
Here’s Five Fast Facts on the 1% Sales Tax Increase:
- 📈 Who Pays - The sales tax applies to Anoka, Carver, Dakota, Hennepin, Scott, Ramsey, and Washington counties. Groceries, clothing, and prescription drugs are exempt.
- 🚧 Let’s Roll - It looks like 0.75% of the tax will go to a transportation spending bill. It’s projected to raise $560m over the next year. Breathe easy, though — it will fund transit improvement, but not for the Southwest Light Rail extension.
- 🏡 Go Home - The remaining .25% goes toward housing, specifically emergency rental assistance, affordable housing, and rent vouchers for low-income residents.
- 💸 How High? - The bump will bring sales tax above 8% in most of the metro area. Rates specifically in Minneapolis and Edina will be above 9%.
- 💰 Even Higher? - Sales taxes could increase another 1% in St. Paul, with that money going toward park and street maintenance with voter approval.
🔥Bottom line: No one wants their taxes raised, but it looks like basic necessities won’t take a hit… for now.
Is this new tax a good move?
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