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Dayton tells business group he won't back off income tax hike

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Gov. Mark Dayton may have given up on his idea of expanding the sales tax, but he vows he will not give up his push for an income tax hike on the highest-earning Minnesotans.

Dayton spoke to the Minnesota Chamber of Commerce Wednesday in an address the Associated Press describes as often confrontational. He says the revised budget plan he'll roll out Thursday will keep his proposal to create a new tax bracket for couples who earn more than a quarter-million dollars and individuals with income over $150,000.

Dayton's spirited defense of the idea caught some in his audience off guard. Chamber President David Olson told the Business Journal that members were ready to applaud the governor's decision to drop the sales tax expansion. But they heard a speech that Olson thought was confrontational and defensive.

Dayton says he thinks the higher income tax is fair and the state needs the revenue to offset its deficit and increase education spending.

But he also did some more general venting.

The Star Tribune says the governor criticized business leaders who bash the state's business climate. He said Minnesota taxes and spending have declined relative to other states.

MPR reports Dayton also expressed frustration with critics who call for spending cuts but offer no suggestions on where to cut.

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