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Editorial: Dayton’s budget burdens business

Published 10:50am Friday, February 8, 2013

A Wisconsin state representative’s recent effort to lure Minnesota businesses across the border no doubt tickled the funny bones of Wisconsinites and of Minnesotans who are concerned about Gov. Dayton’s budget proposal; what is not funny about it is that, while premature, the effort may well predict more serious efforts to come if some anti-business aspects of the governor’s budget come to pass.

Minnesota, with its abundance of burdensome regulations and relatively high corporate tax rates, already faces challenges in keeping and recruiting businesses. Some aspects of the governor’s tax proposal will not reduce the challenge.

The budget includes a small increase in total corporate income taxes. More significantly, it would apparently add tremendously burdensome sales tax on many services of which businesses are major consumers, from accounting and legal fees to advertising, repairs and engineering services. The costs of these tax increases would ultimately be passed along to the customers of every business, making those businesses less competitive. In short, Minnesota looks like a less attractive place to do business.

There are months of debate and legislative adjustment to come between the budget proposal and the final budget. No doubt many of the most regressive features will be weeded out.

But Minnesotans need to keep in mind that driving away business drives away jobs, and balancing a budget on the backs of business and industry will end up hurting every Minnesotan. We are certain that Wisconsin Rep. Erik Severson will not be the only one to notice — and take advantage.