The legislation will reduce Minnesota businesses' share of the property tax burden from 30% to 24.5%. In addition to the $180 million incommercial/industrial property tax relief, apartment property tax reductions of $67 million will help in the creation of more affordable housing by encouraging more construction within the state, the Chamber says.
Minnesota's current tax burden for apartment housing is double the national average.
Under the bill, the classification rate on commercial/industrial property with value under $150,000 is reduced to 1.5%; the rate oncommercial/industrial property over $200,000 falls to 2%. In addition to the immediate property tax cuts, Minnesota electric rates will be reduced by nearly $30 million because the bill exempts from the statewide property tax the equipment used to generate electricity.
The Minnesota Chamber's members cited reforming the state's property tax system as their top priority for the 2001 Legislative Session. With the property tax structure now reformed, the Chamber's local government finance agenda will likely focus on fixing the currentsystem of state aid to local governments.
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