GOP foes of warehouse tax want special session, repeal

Several Republican state lawmakers are asking DFL Gov. Mark Dayton to convene a special session to revisit a sales tax on warehousing services that was signed into law last month.

An empty warehouse in Albert Lea. (MPR Photo/Elizabeth Baier)

The tax, which will only affect third-party transactions, is not scheduled to take effect until April 2014. But Rep. Tim Kelly, R-Red Wing, said during a state Capitol news conference today that two businesses in his district, Red Wing Shoes and Lawrence Transportation Services, are reconsidering new warehouse projects.

“We have already stopped business,” Kelly said. “That’s jobs. that’s investment that revenue to the state of Minnesota that is absolutely stopped today.”

Rep. Pat Garofalo, R-Farmington, said there’s no reason to wait for a fix.

“There’s bipartisan agreement that this was a mistake,” Garofalo said. “There’s bipartisan agreement that the legislators who voted for this screwed up. The revenue may not be coming in until next year, but the problems, the negative side effects of this tax increase are already being felt by the workers and the taxpayers of Minnesota.”

Gov. Dayton’s chief of staff Bob Hume issued a statement calling the news conference “a stunt, not a solution.” He said if revenues permit, there will be plenty of time next session to review and possible revise the tax.

House Speaker Paul Thissen, DFL-Minneapolis, also dismissed the need for a special session.

“Rather than rush to judgment without more facts and feedback, it is important we listen to the public and business community so we are prepared to make any needed changes next session,” Thissen said in a news release.