ST. PAUL -- Gov. Jesse Ventura will sign a bill providing more than $1 billion in tax relief, his office announced today.
The signing ceremony is scheduled for Monday and will coincide with the release of a report detailing perceived problems in Minnesota's tax system. It was compiled over six months using input from citizens.
The tax bill contains substantial cuts in vehicle registration fees, a sales-tax rebate of at least $640 million and a second round of income-tax rate reductions.
''The bottom line is Minnesotans will get another major decrease in taxes,'' said Senate Tax Chairman Doug Johnson, DFL-Tower.
Under the bill, tax rates would decline in all three income brackets -- by 0.15 percentage point in the top and bottom brackets and by 0.20 percentage point in the middle bracket. The average tax reduction would be about 2.8 percent.
It comes on top of last year's reductions that dropped rates by 0.75 percentage point in the middle bracket and 0.5 percentage point in the top and bottom brackets.
How much Minnesotans benefit depends on several factors. For instance, a married couple with two children, a taxable income of $50,000 and a 1994 model-year car worth $11,995 would save about $487. A single filer with a taxable income of $70,000 and a 1999 car worth $49,995 would save $976.
''We could have done a little bit better,'' said House Tax Chairman Ron Abrams, R-Minnetonka.
House Republicans originally proposed tax cuts totaling $850 million a year. But that was whittled down in end-of-session negotiations.
As part of a three-way budget deal the House, Senate and Ventura were allowed to use $175 million as they wished. The Senate chose to put its money into education, environment and other programs. The House directed its share to income tax relief and other tax cuts. Ventura pumped most of his money into the license tab cuts.
If Ventura had vetoed the tax bill, he would not have gotten his tab cuts.
''I don't think the governor had any choice but to sign the tax bill,'' Johnson said.
The rebate was a goal of all three parties. It uses a different pot of money than the three-way split, which was based on surplus revenues that state economists expect to be ongoing.
Rebate checks will begin arriving by late summer and the first tab cuts will be felt in July. Fees for cars and pickup trucks two model years old will be capped at $189. It will cost a maximum of $99 to register vehicles three model years old.
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