By a vote of 72-62, the Minnesota House approved the Minnesota Tax Relief and Job Creation Act. I supported this measure.
Our top priority is job creation, and every provision in this legislation is designed to encourage job creators to invest in their business and put more people to work.
Numerous current southwestern Minnesota business owners feel that they are overtaxed. Many former area businesses have relocated to South Dakota and Iowa over the years for a more favorable tax climate in those states.
With that in mind, the Tax Relief and Job Creation Act aims to ease the tax burden on business owners by freezing the statewide tax on business property for one year and then phasing it out altogether over 12 years beginning in 2014. The plan also excludes 70 percent of the first $150,000 of value for all business property in tax year 2013.
What would this mean for area business owners? According to research documents obtained from the Minnesota House Taxes Committee, businesses in Rock County would see up to a 21 percent reduction in their property taxes; while businesses in Murray, Lyon, Nobles, Pipestone and Lincoln counties would receive reductions of up to 19.2 percent, 19.1 percent, 18.5 percent, 16.9 percent and 16 percent, respectively.
Also included is a permanent $5 million increase for Minnesota's Angel Investor Tax Credit, which provides incentives to individuals investing capital into startup and emerging companies focused on high technology or new proprietary technology. Greater Minnesota is currently seeing only 6 percent of this investment. This proposal seeks to change that, stating that if 30 percent of future investment is not in Greater Minnesota by the end of 2013, then Angel Investors will receive a 40 percent credit -- instead of 25 percent -- for investing in our rural areas.
The plan also increases funding for the Research and Development Credit, and allows small businesses to take up-front capital equipment exemptions rather than wait months for a refund.
In order to bring more qualified and trained workers to Greater Minnesota, the bill creates an internship grant program designed to attract and keep talent in our rural areas, and it also establishes a permanent tax credit to encourage employers to hire veterans.
If we continue with the status quo, southwestern Minnesota will continue to lose job opportunities to South Dakota and Iowa. This legislation encourages our current employers to not only stay here but to expand business, while also showing prospective employers that Minnesota is serious about improving the business climate in this state.