Study: highest earners pay smaller percentage of income in state taxes than other Minnesotans

The lowest income Minnesotans paid a higher percentage of their incomes in state and local taxes than did the wealthiest Minnesotans, according to the Minnesota Department of Revenue’s newly released Tax Incidence Study.

In 2010 Minnesotans with incomes of $31,810 and below paid 14.2 percent of their income to cover state and local taxes while Minnesotans with incomes of $824,186 and higher paid 10.2 percent of their income for state and local taxes, the study said.

The projected 2015 tax burden for the lowest and highest income categories came in at 12.6 percent and 10.1 percent respectively.

DFL Gov. Mark Dayton campaigned in 2010 calling for higher taxes on the wealthy. His budget proposal would increase income taxes on top earners. It also seeks to restructure the state sales tax by lowering the rate but broadening the tax base to include business services such as accounting and legal work.

The study confirms what Dayton administration officials already knew, said Dayton’s Revenue Commissioner Myron Frans.

“Lower-and middle-income Minnesotans continue to pay a larger share of their income in state and local taxes than higher-income Minnesotans,” said Frans.

  • Dan

    I am totally in favor of equal taxation of all Minnesotans, and support efforts to make that a reality.

    I do not support additional taxes on services, and would encourage our legislators to revisit those currently taxed.

    Increased revenue through taxation should not be the focus year after year, but rather how to better manage the current monies for the best return.

    Legislators need to learn from households on fixed incomes or low incomes. They cannot raise their incomes with the stroke of a pen. Rather they must budget within their means.

    If Minnesota truly wishes to encourage business and community growth … then be the State that maintains a low tax rate with tax spending focus on essential infrastructures.