Bill > SF1936

This bill introduces a new tax structure and eligibility restriction for corporations in Minnesota based on the pay ratio between their principal executive officer and median worker pay. Specifically, the bill establishes an escalating additional tax for corporations with high pay ratios, ranging from 0.2% for companies with a 50:1 pay ratio to 1.5% for companies with a 500:1 or higher pay ratio. The pay ratio is calculated using federal regulations, with unitary businesses (those with multiple related corporate entities) required to calculate a cumulative pay ratio across their entire group. Additionally, corporations subject to these increased tax rates will be ineligible to receive state grants. The new tax provisions and grant restrictions will take effect for taxable years beginning after December 31, 2025, effectively giving corporations time to adjust their compensation structures. The goal appears to be incentivizing more equitable pay practices by financially penalizing companies with substantial disparities between executive and worker compensation.

Budget and Finance

https://www.revisor.mn.gov/bills/bill.php?b=Senate&f=SF1936&ssn=0&y=2025