Gov. Tim Walz wants to tax people when they get financial and legal advice, a proposal that critics say hurts vulnerable residents while leaving businesses unscathed. <\/p>\n\n\n\n
\u201cThe proposal would be extremely detrimental to the Minnesotans who can least afford it, especially during the most stressful, challenging and unexpected moments of their lives,\u201d said Samuel Edmunds, president of the Minnesota State Bar Association, in testimony before the Senate Taxes Committee on Tuesday. <\/p>\n\n\n\n
But Walz\u2019s revenue team says it would make the state tax system fairer, plus add over $200 million a year to state coffers, even as the governor\u2019s budget also would slightly decrease<\/a> the state\u2019s sales tax rate from 6.5% to 6.425%. <\/p>\n\n\n\n \u201cCutting the tax rate and broadening the base to include professional services will help right-size our sales tax to a more service-oriented economy,\u201d Shane Delaney, an assistant commissioner at the Minnesota Department of Revenue, wrote in an email to MinnPost. <\/p>\n\n\n\n The prospect of a sales tax expansion illustrates the unpleasant decisions facing Walz and the Legislature as they hammer out their two-year budget that would begin in July. The Senate and House are debating the governor\u2019s budget proposal amid forecasts<\/a> the state is veering from a net surplus in its next budget to a deficit four years from now. And that\u2019s without factoring in the looming threat<\/a> of Minnesota losing billions of dollars<\/a> in federal money under the Trump administration and a Republican-controlled Congress. <\/p>\n\n\n\n At the Taxes Committee hearing, Sen. Carla Nelson, R-Rochester, acknowledged the \u201ctough spot\u201d Paul Marquart, the Revenue Department\u2019s commissioner, is in.<\/p>\n\n\n\n But Nelson also called the tax on advisory services \u201cregressive\u201d and \u201cnot a good policy.\u201d<\/p>\n\n\n\n