Skip to main content

Tax changes: Businesses push back, Dayton digs in


Battle lines are coming into focus as the opening volleys are fired in the fight over Gov. Mark Dayton's proposed revamp of Minnesota's tax system.

The Star Tribune suggests the outcome of the debate could define the political career of the Democratic governor, who is also a former U.S. Senator.

On a day when business groups sharpened their attacks on the idea of expanding a lowered sales tax to include business services, Dayton defended his plan in a speech before newspaper executives.

Business groups are particularly critical of the part of Dayton's plan that would apply the sales tax to services provided by ad agencies, accountants, and lawyers among others. They say the cost of that 5.5 percent tax would be passed along to customers, which would cut into business and job creation. The CEO of one advertising firm called the governor's plan insane and rhetorically asked the Pioneer Press, "Why would we operate in Minnesota?"

Establishing a Wisconsin branch may not be a solution, though. Dayton's revenue commissioner, Myron Frans, tells MPR Minnesota purchasers of those services would still have to pay the tax. Frans says critics should consider the sales tax in the context of the entire plan, which also includes cutting corporate taxes and freezing business property taxes. The opposition is no surprise to the Dayton administration. Frans says of those fighting the tax on business services: "The fact of the matter is they've been untaxed in Minnesota ... and it's time for them to pay their fair share like everybody else."

Sounds like the battle has begun.

Next Up

Dalvin Cook

Report: Dalvin Cook was already playing with torn labrum

There is concern that Cook may have a torn labrum on both sides of his body.

covid, vaccine

Minnesota's COVID-19 update for Monday, November 29

The state's latest report includes data from the Thanksgiving break.

unsplash - woman sick coughing - CROP

Long COVID: Review of Mayo patients may provide new clues

The researchers summarized three "major novel findings" from the data.

Joe Biden

Biden's visit to MN will include stop at Dakota County Technical College

The $1.2 trillion infrastructure bill passed earlier this month.

Brooklyn Center police

Victim of 'accidental' shooting ID'd as 23-year-old Duluth woman

The 23-year-old died three days after being shot while sitting in a parked vehicle.


Motorist dead after crashing into utility pole in south Minneapolis

The crash happened Saturday night in the South Uptown neighborhood.

police lights

St. Cloud mother arrested after 3-month-old baby found dead

Officers discovered the baby during a welfare check Sunday.

Merwin Liquors Mounds View

Police shoot, kill man inside Mounds View liquor store

It follows an alleged armed carjacking outside a nearby Aldi.

Dalvin Cook

Report: Dalvin Cook has dislocated shoulder, will undergo MRI

The Vikings running back was carted off the field in Sunday's loss to the 49ers.

Kirk Cousins

Watch: Kirk Cousins lines up under guard on critical 4th down play

Kirk Cousins went "Full Kirk" at the worst possible time.

Dalvin Cook

Dalvin Cook injured, Vikings drop crucial game against 49ers

The Vikings couldn't stop the Niners' rushing attack in a 34-26 loss.

Flickr - police lights squad siren - Edward Kimmel

Man airlifted to a hospital after police shooting in Forest Lake

Police allege that the man presented a threat to officers.