Bill > SF2585

This bill modifies the corporate franchise tax rate in Minnesota by creating a mechanism for potential tax rate reductions under specific conditions. Currently set at 9.8%, the corporate tax rate can be reduced by 0.312 percentage points if two key conditions are met: first, if there is a budget surplus equal to or greater than the estimated revenue reduction from the rate change, and second, if over 70% of the corporate franchise tax is found to be allocated to consumers according to the most recent tax incidence report. The tax rate can be reduced multiple times, but cannot go below 8.24%. The commissioner of revenue is required to publish notice of any rate reduction by December 31, with the new rate becoming effective for taxable years beginning after the publication date. The bill defines specific terms like "budget surplus" and "net adjusted revenue reduction" to clarify the conditions for rate adjustment. This legislation aims to provide potential tax relief for corporations based on state fiscal health and tax burden distribution, with the first possible rate reduction applicability starting after December 31, 2025.

Budget and Finance

https://www.revisor.mn.gov/bills/bill.php?b=Senate&f=SF2585&ssn=0&y=2025