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Capitol View®
Tom Scheck

House and Senate getting closer to agreement on taxes.

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The Senate Rules Committee created a vehicle bill this afternoon that would allow for revenue and spending in one bill.

DFL Sen. Larry Pogemiller said the bill (which leaves spending amounts blank) will likely be agreed upon in a separate tax conference committee tonight. DFL Senator Tom Bakk said the plan will likely raise $1 billion in unspecified taxes. He said he would like to rely on an income tax increase for his portion of the plan, but hinted that House Democrats are also interested in raising other taxes like the alcohol excise tax or the cigarette tax:

"If you're looking at a menu of tax options, we'll look at things like sin taxes, the 4th tier (income tax on wealthy Minnesotans). "People generally like tax increases they don't have to pay so generally so those kinds of things tend to poll better so I suspect that you'll see come out there are things that will have some level of public support."

A source with the Minnesota House said the plan will rely on a 4th tier income tax increase and increasing the alcohol excise tax. The source said increasing the cigarette tax is not on the table. The source added that the Senate may include another unspecified provision.

The spending portion of the bill would include targets for education and health care.

It appears that the plan is to send a bill to Governor Pawlenty that links tax increases to increased spending for schools and health care programs. Pawlenty has said he'll veto any bill that includes a tax increase.