Federal Tax Cuts Leave States in a Bind
The federal tax overhaul cut taxes for millions of American families and businesses. But the law also had an unintended effect: raising the state-tax bite in nearly every state that has an income tax.
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Business groups have criticized the governor’s proposal, which they argue would make Minnesota less competitive. Some progressive groups say the state should go further, using the extra revenue generated by the federal law to fund a paid family-leave program or childhood savings accounts. “This is exactly the kind of thing you could use to start the core investment of a program like that,” said Chris Conry, strategic campaigns director for TakeAction Minnesota, a liberal advocacy group. “You could give every kid born in Minnesota $500 at birth.”
