DFL candidates for governor trade barbs over taxes

Margaret Anderson Kelliher, Mark Dayton and Matt Entenza all agree taxes should be raised, but they recently started arguing over the scope and the amount of those tax increases.

Mark Dayton has been campaigning for months on a "tax the rich" message. Lately, he's been adding new details to the proposal to increase the income tax rate for wealthy Minnesotans. During a recent gubernatorial forum in St. Paul, Dayton declared that he was the only DFL candidate willing to raise $5 billion through tax increases and tax compliance.

"If you have a $6 billion deficit and you're only going to raise a billion in revenues, then you're going to have to find $5 billion in cuts or shifts," Dayton reasoned. "If you're going to raise $5 billion in revenues, as I've proposed, then you still have to find a billion in cuts and shifts, and that's hard enough."

So far, Dayton has offered more tax specifics than either of his DFL primary rivals. He wants to add up to three new upper income tax brackets starting with individuals making more than $130,000 a year and couples making more than $150,000. People making more than $500,000 would pay even more, and those over $1 million would pay significantly more.

Dayton is also proposing to restore a third property tax bracket for homes valued at more than $1 million. Minnesota's current property tax rates are 1 percent for homes worth up to $500,000 and 1.25 percent for homes over that amount.

And he said snowbirds could no longer avoid Minnesota taxes if they live in another state for six months and one day each year.

"I know where that money is. I know who has it. And I will get it, if I'm your governor," Dayton said.

Dayton has accused other DFL candidates of misrepresenting his tax plan. He points specifically to a recent quote from John Gunyou, the running mate of the DFL-endorsed candidate Margaret Anderson Kelliher. Gunyou said Dayton's proposal would more than double taxes on everyone making more than $75,000 a year. Dayton insists that's not true.

"I know where that money is. I know who has it. And I will get it, if I'm your governor."

Kelliher is also poking holes in the Dayton plan, which she has described as more slogan than solution. Kelliher said tax increases totaling $5 billion would add to an already heavy property tax burden.

"If Mark Dayton wants to raise taxes on senior citizens and put more pressure on property taxes in the state of Minnesota, that's what he's going to get at a $5 billion plan," Kelliher said. "I think most Minnesotans would reject that, and I really seriously doubt that any legislature would pass that to a governor to sign."

Kelliher agrees that people earning more than $250,000 are currently not paying their fair share of income taxes, and she wants to make changes in the system. But Kelliher said only about a third of her deficit solution would come from taxes. She said she will release a more detailed plan in about three weeks.

DFLer Matt Entenza is also targeting people with incomes of $250,000 and above for roughly a third of his budget solution. He's also proposing to collect state sale taxes from Internet purchases. Entenza describes Dayton's plan to erase the deficit primarily through tax increases as one extreme. He said the other extreme is Republican Tom Emmer's plan to balance the books with spending cuts alone.

"My proposal is what I see as the traditional way that Democrats and Republicans have handled things, which is a balanced approach with a combination of budget cuts, some shifts and then some very targeted increases of revenue using the internet and the income tax earners at the high end," he said.

Entenza said his proposed tax increase could take the form of a temporary surcharge on higher income groups. He said lawmakers could blink off that surcharge once the state budget is back in the black and the economy improves. Entenza said he too will release a more detailed tax plan in the coming weeks.

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