Tax on professional services included in governor’s budget proposal
March 17, 2026 | Linda Wedul, CAE
Gov. Tim Walz on Tuesday announced his supplemental budget proposal and priorities for Minnesota. The proposal includes good news and bad news for the MNCPA’s legislative priorities.
Notably, Walz remains interested in pursuing a tax on professional services, which the MNCPA has opposed for many years. This revenue generator is surprising because the state’s February financial forecast was an improvement, estimating Minnesota will have a $3.7 billion surplus over the next 15 months, an improvement over the last outlook, which was $2.4 billion. Looking further out, the previously expected deficit for the 2028-29 budget is now projected to be a small, $377 million surplus, according to the Minnesota Management and Budget office.
Walz’s proposal also includes language encouraging “adopting most of the federal tax changes to provide simplicity and predictability for tax filing in Minnesota and ease of administration.”
We’re evaluating the budget plan in further detail so we can best understand the nuance of each conformity piece.
What I can tell you today is that R&E expenditure was not included in Walz’s proposal.
On the positive side, Walz does support renewing the PTET election, which comes at no cost to Minnesota and will save an estimated $400 million in federal taxes for Minnesota taxpayers.
The MNCPA will continue to advocate on behalf of you, your clients and your businesses at the Capitol.
Topics: Legislative & Government Affairs
Linda Wedul, CAE
Linda Wedul is president and CEO of the MNCPA. She’s usually spotted at MNCPA events, introducing herself to members with a warm smile and memorable laugh. Mixed among the Footnotes, accounting journals, leadership books and three monitors in her office, you’d be surprised to see a dog kennel. Her unpaid job is volunteering as a foster family for service dogs in training through Can-Do-Canines. She and her husband have two adult children and live in Farmington. Linda can be reached at 952-885-5516 or lwedul@mncpa.org.
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