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After a false start, Senate votes to expand sales tax

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The Minnesota Senate Monday rejected the sales tax changes its DFL leadership proposed. Before changing its mind and passing the bill a couple of hours later.

Lots of eyebrows went up when Senators defeated the tax bill on a 34-32 vote. But DFLers quickly called a for a recess, met behind closed doors, came back onto the floor, and passed the bill 35-31.

Two DFLers switched their votes and a third who sat out the first go-round voted yes the second time.

Senate Majority Leader Tom Bakk tells MPR there was no arm-twisting involved. He says some Senators miscalculated and thought the bill would pass even without their votes.

Bakk told the Pioneer Press that while in the back room he reminded his colleagues they'd cast some easy votes that involved spending more money. "Now it's time to pay for all that spending," he said he told them.

The bill would actually lower Minnesota's sales tax, but it would raise revenue by extending that tax to many currently exempt services and items.

As Fox 9 reports, taxing clothing purchases of $100 or more is among the most contentious provisions. But the expansion of the tax would encompass over-the-counter drugs, haircuts, car repairs, and piano lessons, among other things.

In addition to lowering the expanded sales tax, the bill would reduce the corporate tax rate to what the Star Tribune reports is the state's lowest level since the 1960's. But Republican critics say the extension of the sales tax to so many new items amounts to a tax hike on all Minnesotans and violates the DFL campaign to confine tax increases to the wealthy.

Of course, the Senate plan is still not law. KARE 11 notes that Gov. Dayton abandoned a similar plan to expand a lowered sales tax. And the tax bill the House passed last week leaves the sales tax as is. It'll be up to a conference committee to work out the differences.

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