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House DFL tax plan has surcharge on high earners, less aid than Mayo sought

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DFLers in the Minnesota House unveiled a tax plan that would increase state revenue by $2.6 billion, largely through higher income taxes on the wealthiest residents and hikes on cigarette and alcohol taxes.

While Gov. Dayton and state Senate leaders have also endorsed a new income tax bracket for high earners, the House plan also includes a two-year surcharge on the wealthiest Minnesotans. That money would be used to pay off the state's debt to its school districts.

Republican leaders labelled the plan "taxes gone wild."

The Associated Press reports the measure would allocate less money for improvements in Rochester than the Mayo Clinic is seeking. Mayo has said $500 million in upgrades to infrastructure are needed for the clinic to proceed with a 20-year, multi-billion dollar expansion. The House would authorize $300 million in state money, with an option for Rochester and Olmsted County to put in another $100 million, the AP says.

The House plan will need to be reconciled with those of the Senate and Governor Dayton in coming weeks. As MinnPost reports, all of the plans involve tax increases but each has its own variations.

The Senate tax plan includes lowering the state sales tax and extending it to currently untaxed services, in a move reminiscent of the tax overhaul that Gov. Dayton proposed and then dropped.

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