Beginning the hard work of implementation
Advocacy
Paul Marquart | October/November 2023 Footnote
The legislative session produced many changes to state tax laws. These updates provided benefits to many Minnesota residents and businesses, along with some urgency and implementation challenges at the Department of Revenue.
As a former legislator who served on — and chaired — the House Taxes Committee, I'm no stranger to changes in our state tax code. But as commissioner of Revenue, I've learned a lot about what it takes to makes those changes happen on the ground.
Passing tax legislation can be a challenge, with a lot of discussion among stakeholders, committee members, agencies, the governor and the public. Balancing these many different viewpoints — political, practical and others — requires patience, diligence and compromise.
Yet in most ways, once a bill is passed and signed into law, the hard work is only just beginning.
The number — and reach — of changes this year presented some special challenges. For example, we're tasked with issuing an income tax rebate and leading an advisory task force on local sales, food and beverage, and lodging taxes.
Tax rebate
The tax bill defined the rebate as a one-time refundable tax credit for tax year 2021. Revenue needed to:
- Determine who qualifies and their payment amount based on 2021 individual income tax returns.
- Send payments to those filers by direct deposit, where possible, or by mailing a check. And we needed to do it around the same time as property tax refunds, one of our busiest times of year.
The tax bill authorized Revenue to contract with a vendor, which allowed us to send the rebate without interrupting property tax refund payments. We did not want to risk any delay in property tax refunds - which many taxpayers rely on for October property tax payments, back-to-school shopping and other needs.
Our vendor, Submittable, also provided an online form for filers to update their bank information or address for the rebate if needed.
We began processing rebate payments through Submittable and U.S. Bank in late-August. At time of writing, we're on track to issue all the payments by the end of September. You can find details about the rebate program on our website at
www.revenue.state.mn.us/direct-tax-rebate-2021.
Task force
The tax bill created a Local Taxes Advisory Task Force to explore how cities and counties use local taxes to fund projects, and to recommend possible improvements. I am chair of the task force, which includes four members of the public along with city and county representatives.
Before the group's first meeting, we needed to field applications and select public members. We also created an internal team at Revenue to provide support and information requested by the group.
The task force is reviewing current laws and will consider:
- How best to evaluate proposed local sales, food and beverage, and lodging taxes before legislators vote to approve them. Local sales taxes also require voter approval.
- The best organization or entity to conduct these evaluations.
- Possible law changes to improve the process for creating and updating local taxes.
The task force is meeting every two weeks until it issues a report and recommendations for legislators by Jan. 15, 2024. Three meetings are reserved for public testimony. All meetings are open to the public, and you can attend in-person or virtually.
You can find a full schedule, meeting updates and materials and other information on our website. Visit our homepage at
www.revenue.state.mn.us and enter the search term task force.
Shared challenge
At Revenue, our mission is working together to fund the future for all of Minnesota - but, in many ways, change is our business!
We share the challenge of changing tax laws with the MNCPA and our other partners. And we strive to provide the information and tools you need to serve your clients. For the latest updates, visit
www.revenue.state.mn.us/tax-law-changes.
Meanwhile, please contact us if you have questions or need additional guidance, and we'll do our best to help. Thanks for your partnership!
Paul Marquart is the commissioner of the Minnesota Department of Revenue.
