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Rep. Atkins proposed HF0857, a bill for an act “relating to public pensions” that will impose another regressive tax increase on all Minnesotans. Here’s the bill’s key language:

Sec. 2. [297I.07] SURCHARGE ON HOMEOWNERS AND AUTO POLICIES.
Subdivision 1. Surcharge on policies. (a) Each licensed insurer engaged in writing insurance shall collect a surcharge equal to $5 per calendar year for each policy issued or renewed during that calendar year for:
(1) homeowners insurance authorized in section 60A.06, subdivision 1, clause (1)(c); and (2) automobile insurance as defined in section 65B.14, subdivision 2.

Rep. Atkins’ submitted legislation will hit virtually every Minnesotan with a $5 surcharge, aka tax increase. Rep. Atkins’ legislation treats a symptom. It doesn’t fix the problem. This statement highlights the problem:

The 2010 Pension Reform Act includes provisions to increase vesting periods, increase employer and employee contribution rates, lower deferred interest rates for inactive members and lower refund interest rates. At the end of FY2010, the Minnesota State Retirement System, the Public Employees Retirement Association and the Teachers Retirement Association combined have lowered their unfunded liability by over $5.5 billion.

Too many of the public employee pension plans are defined benefit plans. They should be defined contribution plans. That change would dramatically shrink Minnesota’s unfunded pension liability.

Instead of fixing the problem, which would require political leadership, Rep. Atkins favors imposing another regressive tax increase on Minnesotans. This legislation is proof that the DFL’s insistance on fairer taxation is blather. The DFL, starting with Gov. Dayton and continuing through the DFL legislature, believes in all tax increases, not just progressive tax increases.

It’s time for the DFL to show the political courage that fixes problems, not treat symptoms. HF0857 isn’t a step in that direction.

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3 Responses to “Another day, another DFL tax increase proposal”

  • walter hanson says:

    So let me get this straight.

    He proposes a tax which will paid more by the poor and middle class than the rich. After all $5 is a greater percentage of their income which is the argument they make for taxing the rich.

    And shouldn’t there be some type of link to the area where the tax is going to. Car sale taxes, gasoline taxes, and reg taxes are meant for road construction and approved (unfortnately) for transportation projects. At least they are linked.

    Walter Hanson
    Minneapolis, MN

  • Chad Q says:

    So I have to pay more on my insurance policies so a public employee can retire at 55 with full benefits? I guess this is just another one of Rep. Atkins ways he has created capitalism.

    The DFL couldn’t care one lick about the poor or middle class. All they care about is protecting the unions, creating as many social programs as possible, and taxing everything. It is sad that the people who continually vote for these DFLer’s really believe that the DFL cares about them and has their best interests in mind.

  • Gary Gross says:

    Chad, you’ve totally nailed it. This isn’t a one-time bailout, either. Because the DFL legislature won’t fix the underlying problem, they’ll turn this into an ongoing taxpayer-subsidized annual bailout.

    Here’s the nasty little secret: the St. Paul Teachers’ Retirement Association won’t be the only pension fund that’ll get a bailout this session. Duluth is waiting in the wings for their bailout, too.

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