Tax Issues
Estate/Death Tax Federal Conformity
Issue Overview: NFIB's top tax priority for the 2008 session is conforming Minnesota's estate/death tax exemption thresholds to the federal thresholds for small businesses and farms. Minnesota's current exemption thresholds are $1 million and $2 million, while the federal thresholds are $2 million and $4 million. Due to this situation, an increasing number of Minnesotans will have to pay the state death tax but will not have to pay the federal tax. NFIB is leading a coalition and has developed a proposal to provide estate tax relief for assets held in small businesses and farms. The threshold for small business under the provision is a business that is privately held with less than $10 million dollars in annual revenue.
Issue Status: This bill passed the House and made it into the final Tax Conference Committee thanks to the efforts of Rep. Ann Lenczewski, the House tax chair. It did not make it into the final tax bill that was vetoed last year. Currently it is pending in the House Tax Committee, and NFIB is trying to get it inserted into the 2008 omnibus tax bill.
NFIB Position: We strongly support this legislation.
What to Do: Contact your state lawmakers and encourage them to support the House estate tax provision contained in the House tax bill.
Constitutional Amendment to Raise and Dedicate the Sales Tax for Game Fish and Arts Funding (SF 6, Pogemiller; HF 2285, Sertich)
Issue Overview: This proposal is back again. It is another attempt to get around the governor by putting it in the form of a constitutional amendment. Constitutional amendments cannot be vetoed by the governor and if the legislature passes them, they go to the voters for approval. This proposal would raise the sales tax by three-eighths of one cent and would then dedicate it in the following manner: 34 percent to the heritage enhancement fund; 22 percent to parks and trails; 22 percent to the clean water fund/ and 22 percent to the arts, humanities, museums and public broadcasting fund.
Issue Status: This bill was placed on a fast track by majority party leaders of the Legislature and passed both Houses. Gov. Pawlenty could not veto is since it is a constitutional amendment but voters can veto is next fall in the general election. It is important to note that a constitutional amendment requires a majority of those who voted in the election as opposed a majority of the people who voted on the amendment. This makes it more difficult to pass.
NFIB Position: NFIB opposed this constitutional amendment.
