Minnesota Governor Tim Walz has been noted for his unique stance on tax reform compared to other states in recent years. While many states have opted to cut taxes, Minnesota, under Walz's leadership, has taken a different approach by raising taxes. This decision has made Minnesota one of the few states to implement tax increases.
One of the key changes introduced by Governor Walz was the imposition of a surtax on long-term capital gains income and other investments. Additionally, a new law was signed to partially phase out standardized and itemized deductions for high earners in the state. Another law expanded the scope of the corporate income tax, enabling Minnesota to capture more international business income.
These tax adjustments were made despite Minnesota boasting a substantial $17.6 billion budget surplus. This surplus suggests that the tax increases were not primarily driven by revenue needs but rather aimed at enhancing tax progressivity within the state.
