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HF 1924

Cottonwood County; refundable sales and use tax exemption provided for construction materials.

2025-2026 Regular Session Introduced by Joe Schomacker

HF 1924 would provide a refundable Minnesota sales tax exemption for eligible construction materials used only on projects in Cottonwood County.

Introduction and first reading, referred to Taxes
#counties-specific #taxation-salesanduse
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Bill Summary · HF 1924

Summary of HF 1924 (2025-2026) – Minnesota

Overview

HF 1924 proposes a refundable sales and use tax exemption for construction materials used in Cottonwood County. The bill is introduced in the Minnesota Legislature and referred to the Taxes committee. The sponsor is Rep. Joe Schomacker (co-sponsor).

  • Jurisdiction: Minnesota
  • County Focus: Cottonwood County
  • Subject: Refundable sales and use tax exemption for construction materials

Purpose and Intent

The bill aims to reduce the cost of construction projects in Cottonwood County by providing a refundable exemption from Minnesota sales and use taxes for eligible construction materials. The intent is to encourage construction activity, stimulate local economic development, and support infrastructure or building projects within the county.

Key Provisions (as described in title)

  • Refundable exemption: Eligible construction materials purchased for use in Cottonwood County would be exempt from Minnesota sales and use taxes, with the exemption provided on a refundable basis.
  • Scope of materials: The exemption applies specifically to construction materials. The bill would define what qualifies as “construction materials” for the purposes of the exemption (e.g., materials used for building, renovation, or improvement projects).
  • Refund mechanism: The exemption is refundable, meaning taxpayers would receive a refund of the sales tax paid on qualifying materials, subject to the terms and conditions established by the bill.
  • Geographic applicability: The exemption applies to projects located in Cottonwood County, Minnesota.

Note: The bill’s text would provide the precise definitions, eligible project types (e.g., new construction, renovations, public works), and any exclusions or limitations. The summary reflects the title-described scope pending the bill’s full language.

Who Is Affected

  • Construction industry participants in Cottonwood County: Builders, contractors, developers, and material suppliers who purchase construction materials for qualified projects in the county.
  • Property owners and project sponsors in Cottonwood County: Individuals or organizations funding or commissioning eligible construction work.
  • State and county tax administration: Agencies implementing, processing, and auditing the refundable exemption, including the mechanism to issue refunds.

Procedural and Timeline Considerations

  • Introduction and referral: As of 2025-03-05, HF 1924 was introduced and referred to the Taxes committee.
  • Next steps in the legislative process: The bill would need to advance through the Taxes committee, potentially receive amendments, be adopted by the House, pass the Senate (and, if applicable, reconcile differences), and be signed into law by the governor.
  • Effective date and sunset (to be specified): The full text would specify effective dates, any sunset provisions, and administrative implementation details for the refundable exemption.

Potential Impacts and Considerations

  • Economic impact: Could lower the total cost of construction projects in Cottonwood County, potentially boosting development activity and local spending.
  • Revenue impact: May reduce state and local sales tax revenue in the short term for qualified purchases; the refund mechanism is intended to offset this through the refund process.
  • Administrative considerations: Requires a clear process for claim eligibility, documentation, and timely refunds; oversight to prevent improper claims.

If you’d like, I can tailor this summary to include hypothetical examples (e.g., a sample project and tax savings) or compare HF 1924 to similar county-level tax exemptions.

Compiled from official sources — confirm details with the bill’s official record.

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