State Announces Massive Budget Surplus

Date: December 08, 2021

NFIB lobbying to make sure it translates into meaningful, long-term tax relief.

On December 7, Minnesota Management and Budget (MMB), the agency in charge of the state’s finances, announced a projected $7.7 billion surplus for state fiscal years 2022-23. The largest drivers of the projected surplus are increases in corporate franchise tax revenue (+40.6%) and individual income tax (+10.1%) compared to earlier estimates.

This amount grows larger after factoring in an additional $1+ billion taken off the top of the surplus to meet existing statutory obligations:

  • $870 million transferred to state budget reserve fund
  • $359 million for repeal of the June Accelerated Sales Tax Shift (long a priority for some businesses)
  • $111 million transferred to the Vikings Stadium payment account
  • $4 million to the 21st Century Mineral Fund

The surplus does not include $2.7 billion in the state’s budget reserve account, $1.1 billion in unspent federal pandemic relief funds, or an estimated $6 billion in federal money from the infrastructure bill passed by Congress last month.

A $7.7 billion surplus is a staggering figure, even for longtime Capitol observers. While it’s not fully clear how much of the surplus is ongoing or occurred from one-time spikes in certain receipts, it’s obvious the state is overtaxing hardworking Minnesotans.

NFIB will work hard to ensure the surplus results in meaningful, long-term relief for the small businesses that are the backbone of our state’s economy.

Above graphic courtesy of the Minnesota Management and Budget office November 2021 Economic Forecast, Page 3.



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