Cost concerns raised over tax credit

The top Democrat in the Minnesota Senate is taking issue with a Republican plan to expand the state tax credit available to military veterans.

The proposed legislation would eliminate the current income parameters for the credit, and provide every eligible veteran with $750. The cost of the tax credit is estimated at $40 million over the next three years. During a Senate tax committee hearing today, Senate Minority Leader Tom Bakk, DFL-Cook said the bill will cut into education funding for the current biennium and add to the debt already projected for the next biennium.

“I just don’t think it’s responsible to just keep piling up debt like it doesn’t matter,” Bakk said. “I mean there’s a new group of legislators going to show up here next year with a real problem on their hands. And we just keep hearing bills here that that make it worse, like it doesn’t matter.”

The bill’s chief author is Sen. Jeremy Miller, R-Winona. Miller said he thinks the tax credit could pay for itself by attracting more veterans to Minnesota to live and retire.

“They’ll be buying homes here,” Miller said. “They’ll be starting businesses, either starting families or maybe having grandchildren here in the state of Minnesota. So, let’s encourage people to move to the state of Minnesota and not leave the state of Minnesota.”

The tax committee laid over the measure for possible inclusion in a bigger tax bill.

  • L. Helmer

    I am completely in favor of programs that benefit our veterans. However, I am confused by the statement by the bill’s author that the tax credit could pay for itself. Does he truly believe that $750 per year will entice veterans who do not already live in Minnesota to pick up and move here or retire here? Addtionally, to “have grandchildren here” those veterans would also have to bring their adult children and their families here as well. I don’t think so.