MN Senate Democrats Propose Sales Tax Hikes Again
The debate over Minnesota’s sales tax is back on at the state Capitol as budget bills continue to be tweaked.
On Thursday, Senate Democrats released a wide-ranging tax proposal that would make certain consumer services subject to state sales tax while lowering the overall rate that gets charged on all purchases.
Unlike the controversial plan Gov. Mark Dayton issued initially, the Senate plan steers clear of taxing business-to-business services.
The Associated Press reports that among the consumer services that would be taxed are: haircuts, spa treatments, tattoos, sports lessons, elective cosmetic surgery and wedding planning.
Minnesota’s clothing tax exemption also would go away, but a new credit could be claimed on income taxes.
In exchange for the broader base under the proposal, the state tax rate would fall from 6.875 percent to 6 percent starting this summer.