DFL House leader Paul Thissen wasted no time using the final budget agreement to solicit cash from voters.
The day after the deal was signed, Thissen penned a fundraising letter, claiming that Republican leadership wouldn’t compromise with his party on Gov. Mark Dayton’s plan to temporarily raise taxes on Minnesotans wealthiest, “even though it would only affect 7,700 people, and even though only half of those people are Minnesota residents!”
Thissen’s claim is basically correct.
During the campaign, Dayton maintained he’d raise taxes on the state’s wealthiest to close the budget gap. Once he took office, that plan narrowed. In the final throes of the budget battle, Dayton offered to raise taxes only on Minnesotans making more than $1 million in taxable income annually, and only through 2013.
Republicans roundly rejected the idea, as they have all of Dayton’s efforts to increase taxes; they contend that tax hikes will hurt small business owners and potentially prompt people to leave the state.
Thissen points out that half the people who would have been taxed don’t live here.
According to the Minnesota Department of Revenue, 7,700 millionaires are expected to file with the state for tax year 2011. About 3,900 of those returns are coming from year-long Minnesota residents.
The rest are from part-time or out-of-state filers. The former are people who move in the middle of the year and pay taxes in Minnesota and another state as a result. Non-residents are those who make money in Minnesota, such as income from a business or rent, but live somewhere else.
The revenue department can’t say precisely how many returns are from part-time residents and how many are from non-residents, but estimates that most are from the latter group.
Thissen said that half of the millionaires Dayton’s new plan would have taxed don’t live in Minnesota year-round. For the most part, he’s correct. According to the revenue department, about half of the 7,700 returns from millionaires come from people residing elsewhere.
Letter from Rep. Paul Thissen, July 21, 2011
Minnesota Public Radio News, Dayton puts two new offers on the table, by Catharine Richert, July 6, 2011
Interview, Carrie Lucking, spokeswoman, House DFL Caucus, July 26, 2011
Interview, Minnesota Department of Revenue, Tax Research Division, July 26, 2011