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Bill

SF 3301

Individual income tax and corporate tax phasing out provision

2025-2026 Regular Session Introduced by Cal Bahr and 4 co-sponsors

Minnesota bill proposes gradually eliminating state income and corporate taxes without specifying replacement revenue sources or implementation timeline.

Referred to Taxes
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Bill Summary · SF 3301

Legislative bill overview

SF 3301 proposes a phased elimination of Minnesota's individual income tax and corporate tax over a specified period. The bill would gradually reduce these primary state revenue sources while presumably shifting toward alternative funding mechanisms. This represents a significant structural change to Minnesota's tax system.

Why is this important

Minnesota currently relies on income and corporate taxes as major funding sources for state services including education, healthcare, transportation, and social programs. Phasing out these taxes would fundamentally alter state revenue generation and require either replacement revenue sources, spending reductions, or both. This directly affects the state budget and services available to residents.

Potential points of contention

  • Revenue replacement uncertainty – The bill does not specify what revenue sources would replace income and corporate taxes, raising questions about fiscal sustainability and whether other taxes (sales, property) would increase
  • Service delivery impact – Without clear alternative funding, phasing out major tax sources could require significant cuts to state-funded programs that residents depend on
  • Transition timeline – The phasing schedule is not specified in available information, creating uncertainty about implementation effects on budgets, businesses, and individuals during transition periods
  • Equity concerns – Eliminating progressive income taxes while potentially relying more on sales or other taxes could shift the tax burden differently across income levels

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

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