Projected surplus grows by 50+% over earlier estimates
On October 16, state budget officials announced that Minnesota’s projected budget surplus for the recently completed two-year budget (FY 22-23) grew by $820 million to a total of $2.4 billion. The increase is largely due to much higher-than-expected revenue ($739 million), with slightly lower-than-expected spending (-$81 million) playing a smaller role.
Higher revenue was driven by larger tax collections compared to earlier projections:
Source: Minnesota Management & Budget
Read the FY2022-23 Budget Close Report here: FY 2022-2023 Biennium Budget Close Report (mn.gov)
Earlier in October, Minnesota Management & Budget (MMB) released an update on the final collections for Fiscal Year 2023 and the first quarterly budget update for Fiscal Year 2024. Higher collections from partnerships and S corporation taxes accounted for the largest portion of the revised estimates for FY22-23 (+$298 million) and continued to exceed expectations in FY24 Q1 (+$78 million).
Source: Minnesota Management & Budget
While the current surplus pales in comparison to the $18 billion surplus that fueled a massive 40% increase in state spending during the 2023 Minnesota Legislative Session, it remains large by historical standards.
NFIB Minnesota will continue our fight to return surplus tax revenue to hardworking small business owners that paid them and to permanently reduce the tax burden on Main Street.
