Bill > SF3449

This bill modifies Minnesota's corporate franchise tax rate, creating a potential contingent increase based on future federal tax law changes. Specifically, if federal legislation decreases the corporate tax rate from its March 23, 2025 level, the Minnesota corporate franchise tax rate would automatically increase. The base tax rate remains 9.8%, but the bill introduces a mechanism to adjust this rate upward proportionally to any federal corporate tax rate reduction. The commissioner of revenue is required to calculate the percentage decrease in the federal corporate tax rate and then increase Minnesota's tax rate by a corresponding percentage, rounded to the nearest 0.05%. For example, if the federal corporate tax rate drops by 2%, Minnesota's corporate franchise tax rate would increase from 9.8% to around 10%. This change would take effect for taxable years beginning after December 31, 2024, and aims to maintain the state's tax revenue in response to potential federal tax policy changes.

Budget and Finance

https://www.revisor.mn.gov/bills/bill.php?b=Senate&f=SF3449&ssn=0&y=2025